Zerodha co-founder Nithin Kamath, in his latest tweet, warned how higher securities transaction tax (STT) and other measures intended to curb futures and options (F&O) speculation may have led traders towards riskier trading behaviour.
“One of the unintended consequences of increasing STT and all the other measures to curb F&O speculation is that they may have pushed traders toward even riskier trading behaviour,” Kamath said in a post on X,
Kamath shared that approximately 50% of individual futures traders and 40% of option sellers on Zerodha were profitable, compared with just 10% of option buyers. He added that it was too early to assess the profitability of margin trading facility (MTF), given that it was a relatively new product.
According to Kamath, Indian markets had evolved significantly and called for careful consideration of the broader effects of regulatory and taxation changes.
"Indian markets are no longer a backwater, the recent bear phase notwithstanding. We need careful thinking about second- and third-order effects, and thoughtful regulatory design and calibration," he noted.