Key Points
Mumbai: When warnings from the regulator and steep losses for clients failed to curb the retail frenzy for derivatives, Chenayappillil John George took matters into his hands..
Five months ago, the founder and MD of Geojit Financial Services put up hoardings at 180 spots across the broking companys home state of Kerala, flagging the pitfalls of derivatives trading in which most retail traders lose money..
By his own admission, George wasnt guided by altruism" but sound logic" that a business which resulted in big-ticket losses" for his clients wouldnt be sustainable in the long term..
In addition to the hoardings, George has over the past few years doubled the variable pay for staff who get more clients for the SIP businessGeojit also acts as a mutual fund distributor, thanks to its 500 pan India branchesand halved the incentive for those who get more retail client business for derivatives..
However, In terms of index options open interest, a measure of money flowing into the market, retail share stood at 4.2 trillion, or 40% of total open interest in FY24 (April-December 2023), way ahead of proprietary traders ( 2.27 trillion) and corporates ( 1.3 trillion)..
