Investing · 7 min read
Intraday trading versus long-term investing: what the data says
SEBI has published what happens to individual traders in India. The numbers are unambiguous, and worth reading before you open a trading app.
Krish Dalal
Founder and editor, PaisaExpert. Master's in Business Management, London. · Last updated 2026-08-13
This article exists because the search term that brings people here is usually 'how to start intraday trading', and the honest response is to show what happens to people who do. Nobody has an incentive to tell you this. Brokers earn per trade, trading educators earn per course, and signal groups earn per subscription, so the entire visible ecosystem is paid when you trade and paid nothing when you hold.
What SEBI's studies found
- The large majority of individual traders in the equity derivatives segment made net losses across the periods studied.
- Average losses per loss-making trader ran into the tens of thousands of rupees.
- The most frequent traders lost the most, so activity correlated with losses rather than with skill.
- Transaction costs alone consumed a substantial share of turnover, meaning a trader must beat the market by that margin just to break even.
Read the last point twice, because it is the mechanism. Every trade carries brokerage, STT, exchange fees, stamp duty and GST. A long-term investor pays that cost once a decade. A daily trader pays it hundreds of times a year, which means they need to be right by more than the cost, consistently, against professionals with better data and lower fees.
The two activities side by side
| Intraday and F&O | Long-term investing | |
|---|---|---|
| Time required | Hours daily, market hours only | Under an hour a year |
| Costs paid | Per trade, hundreds of times a year | Once, then almost nothing |
| Tax treatment | Business or short-term income at slab or 20% | 12.5% above ₹1.25 lakh after a year |
| Typical documented outcome | Majority lose money (SEBI studies) | Roughly 11 to 13% a year over long periods |
| Who profits from you doing it | Brokers, educators, signal sellers | You |
Notice that this article does not link you to a broker. Almost every page ranking for this search does, because that is where the money is. If you want a demat account for long-term investing, that guide has one, and it is there because buying index funds is the thing we actually recommend.
Frequently asked
What to do next
- Read SEBI's published findings before opening a trading account, not after.
- If you trade, cap it at money you can lose entirely and keep it separate from long-term savings.
- Log every trade, so you judge yourself on the full record rather than the wins you remember.