Retail Investors Stay Net Sellers For Second Straight Month In August

Retail investors continued to be net sellers in the cash market for the second month in a row in August.

The category net sold Rs 2,000 crore worth of equities in August, following a Rs 5,500-crore selloff in July, according to data released by the National Stock Exchange.

Gross buying and selling were higher in August over July.

The data indicates that net inflows have come off in the current financial year, which can be attributed to reduced trading activity by retail investors. 

Direct investment by retail investors in equities stood at to Rs 1,64,900 crore in FY22. That was nearly 2.5 times the net inflows during FY21. 

So far, in this financial year, retail investors have net bought Rs 36,000 crore in the first five months up to August.

In August, unique retail investors trading in the cash market stood at 8.9 million, recovering from a 15-month low of 7.7 million in July. It had peaked at 11 million in January this year.

Unique active retail investors in equity derivatives market stood at 2.7 million in August, a 68-month high.

In the last seven years, retail investors have been net buyers for the last two fiscals—FY21 and FY22.

During this period, they invested nearly Rs 2.3 lakh crore in equities directly through secondary markets, of which Rs 1.6 lakh crore was invested in the previous financial year.

In the current year, retail participation has come off its January peak. That's reflected in the decline in net inflows, the number of retail investors participating in the secondary markets and their overall share in gross turnover.