Ahmedabad: Due to weak perception in the stock market, there has been a steady decline in cash market volume and margin trading accounts in the last nine months. Cash market volume has fallen by 45 percent from its record high level in June 2024, while margin accounts used by investors to buy shares have fallen 16 percent from their historic peak in September 2024.
Analysts believe that the reason for this decline is the weak morale and regulatory changes of the traders. Due to this, the amount of option premium has also reduced. Experts have warned that the decline in margin accounts and decrease in leverage may increase concerns about market liquidity and investor participation.
Despite the steep decline in the stock market in March, the average daily trading in the cash market has declined by 3 percent on a monthly basis. It has seen a decline for the third consecutive month.
A report from ICICI Securities stated that cash trading on NSE continued to fall in the first two weeks of March and average daily trading volume (ADTV) declined by 5.7 percent, while the business volume on BSE remained stable.
The decline in the option premium had begun before the regulatory rules came into force. Along with this, new demat accounts have also declined and the number of active traders has also declined. Margin trading facilities (MTF), through which traders borrow money from brokers to buy shares and securities, also saw a decline of more than 3 percent this month as compared to February.
