In the current fiscal, in general, and in August, in particular, the Indian stock market saw shattering of many past records. The market saw the highest ever aggregate turnover in cash market in the August; the largest average daily turnover in derivatives market in the first five months of FY24; record flows in mutual fund. Also, the number of demat accounts opened in August totaled 31 lakh, marking the highest rate of account opening since January 2022.     

The mutual fund folios touched an all time high of 15.42 crore in August 2023 as compared to 15.14 crore in the previous month. 

The SIP contribution for August rose to an all time high of ₹15,813 crore in August 2023. Also, the number of SIP registered was 35,91,650 in August 2023, the highest ever recorded. Inflow to mutual fund industry touched ₹20,245 crore, again a new record.

According to NSE Market Pulse, the NSE Cash market achieved an unprecedented milestone in August, boasting an aggregate turnover of ₹16.8 lakh crore. In addition to this remarkable feat, the Average Daily Turnover (ADT) in the cash segment also soared to a 22-month high, hitting ₹76,500 crore during the same month. Another noteworthy achievement was in the Equity Derivative segment, where the first five months of FY 24 witnessed an unprecedented ADT of ₹1.7 Lakh crore. This not only surpassed the previous high of Rs 1.6 lakh crore recorded in FY 22 but also exemplified the escalating enthusiasm in the trading realm.

The surge in retail trading enthusiasm became apparent in the positions held in the derivative segment. in the equity derivative arena, retail investors exhibited a consistent trend of being net buyers in equity future and option contracts, which starkly contrasted with the behavior of institutional investors. Over the course of the calendar year 2023, retail investors actively bought F&O positions amounting to an impressive ₹52,300 crore. Meanwhile, during the same timeframe, Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) adopted the role of net sellers in the derivative segment, exiting F&O contracts valued at ₹31,900 crore.

According to data from Central Depository Service and National Securities Depository, the number of demat accounts opened in August totaled over 31 lakh compared to 29.7 lakh additions a month ago and 21 lakh a year ago. The total demat tally crossed 12.66 crore, up 2.51% from a month ago and 25.83% from a year ago.

This surge in retail participation in the Indian stock markets resulted in a substantial increase in retail investments in past few years, reaching an impressive sum of ₹2.3 Lakh crore during FY21 and FY22 each. However, this trend experienced moderation during FY23 and FY24. In FY23, net retail investments dropped to ₹49,200 crore, marking a notable decrease. Furthermore, as of August 31, 2023, FY24 witnessed an outflow of ₹7,000 crore, reflecting the shifting dynamics in the stock market landscape.

The exceptional surge in market activity and retail participation, with new records being set in various market segments is keeping the Indian stock market buoyant. Despite some moderation in the trend, retail investors continue to play a significant role in shaping the dynamics of the Indian stock market.

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