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ARTICLE · 17 DECEMBER 2024

Margin Trading

Shardul Amarchand Mangaldas & Co
Shardul Amarchand Mangaldas & Co
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Shardul Amarchand Mangaldas & Co

Shardul Amarchand Mangaldas & Co

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Over the past five years, especially since Covid-19 lockdown, as we have witnessed, Indian stock market is dominated by a heard of new class of investors.

IndiaFinance and Banking
Yogesh Chande
Yogesh Chande
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Peter Lynch while referring to margin trading said, "when you have a family, and a house, and the market is going down, and you're on margin, it's probably too much pressure for you to do the right research and the right kind of thinking to make good decisions."

Over the past five years, especially since Covid-19 lockdown, as we have witnessed, Indian stock market is dominated by a herd of new class of investors. Since then, these investors have not seen any meaningful downside in the indices or witnessed a bear market. As the meme on social media goes "do you mean markets can even go down?"

In India, margin trading (also known as "Pay Later" or "Buy Stock Pay Later" in commercial parlance) has seen a sharp rise due to increased participation from full-time traders. As per last available data, margin trading facility ("MTF") book for the stock broking industry in India has surged to around ₹80,000 crore in October 2024, a significant jump from about ₹7,100

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