India's investor base tops 130 million, but only one in 10 trade

India's NSE registered investor base crossed 131 million in May 2026, adding 10 million investors in just seven months at a 25.3% CAGR between FY21 and FY26. However, only 12.9 million or roughly 1 in 10 actively traded, with cash market participants falling to 10.8 million from 11.7 million in March and derivatives traders declining to 3.46 million from 3.82 million. The pullback reflects Sebi's F&O regulatory tightening including higher lot sizes and fewer weekly expiries, collective retail losses of over Rs 1 trillion in FY25, persistent FII selling, and cautious sentiment amid global uncertainties including geopolitical tensions and tariff concerns.