Indian investors have earned more by investing in stocks than by returns from real estate and gold. Stock investments have given the highest returns over a five-year period over the past 25 years.
At the same time, the wealth of Indian families has increased by around Rs 717 lakh crore in the last decade. Of this amount, approximately 11% comes from equity income. This information was revealed in a study by the American financial services company Morgan Stanley.
According to the report, the returns of Indian stocks (BSE Sensex) over the last 5 years, 10 years, 15 years, 20 years and 25 years are better than others like real estate, gold, treasury bonds at 10 years and bank term deposits (FD). Has performed better than the asset class.
According to the report, the stocks generated a pre-tax compound annual return (CAGR) of 15% over a 25-year period. At the same time, gold rose by 11.1%, FD banks by 7.3%, and the value of real estate in seven major cities of the country increased by 7%.
Important points from the Morgan Stanley report…
Indian families have earned around Rs 84 lakh crore from the stock market in 10 years. For this, they only invested 3%. Indian families, including founders of new businesses, have earned Rs 819 lakh crore in 10 years. The share of income from equities was around Rs 1 lakh crore, or 20 per cent. This means the promoters also earned around Rs 84 lakh crore. Stock investors had to deal with a high volatility of 30.7% to achieve this return. While gold fluctuated by 11.3% and bank FD by 1.6%.
Indian investment in stocks could soon reach 10%
Rhythm Desai, economist at Morgan Stanley, said in the report: “We believe Indian households are still underinvesting in stocks. In the coming year, their investment in stocks could increase and cross the 10% mark, which is currently only 3%.
The share of individual investors has increased by 8% in 10 years
According to the report, over the last ten years, retail investor participation in Indian stocks increased by 8% to 23.4%. This share was 15.7% in 2013 and 20% in 2018. In line with this trend, the common Indian’s share in the stock market has been growing rapidly in recent years.
Market capitalization has multiplied by four and a half in 10 years, a record
The market capitalization of all listed companies in the country has increased 4.5 times in 10 years. Till March 2014, their total market capitalization was Rs 101 lakh crore, which has now increased to around Rs 437 lakh crore.
The market capitalization of listed companies had touched the highest level of Rs 477 lakh crore on September 27 this year. According to this, India is the fifth largest stock market in the world. This month, India’s share of global corporate market capitalization increased to 4.3%, up from a low of 1.6% in 2013.
Security transaction tax reached Rs 36,000 crore
Due to increased market transactions, the Security Transaction Tax (STT) collection in the country reached Rs 36,000 crore between April and November. This represents 97% of the budget target. The STT on futures and options trading was increased to 0.02% and 0.1% from October.
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NSE increases lot size by 3 in F&O trading: 93% of people suffer losses in this area; B-Tech student lost ₹46 lakh
It is around June 2024. Roshan Aggarwal is a CA based in Assam. A third year B-Tech student came to him to file his income tax return. It had incurred a loss of Rs 26 lakh in futures and options (F&O) trading in 2023-24, but had no source of income. Just a year ago, this student had suffered a loss of Rs 20 lakh.
Even the parents are not aware of this loss. The parents separated. Her mother runs a hotel business. He took out personal loans through microfinance mobile apps for futures and options trading, borrowed money from friends, and even withdrew money from his parents’ accounts without informing them .