The Dark Side of Trading: How the Dream of Quick Wealth Is Destroying Lives in India

KAKALI DAS

As influencers glamorize trading and young investors chase instant riches, thousands are losing not just money, but their peace, families, and lives.

In recent years, trading has become one of the most hyped trends in India. Everywhere you look, on social media, YouTube, or in conversations among friends, there is talk about how people are earning lakhs and crores through trading. It appears so tempting that almost everyone, at some point, wonders why not give it a try. But before putting one’s hard-earned money at stake, one must ask a crucial question: do you truly understand trading? Or are you simply influenced by what others show or say?

A tragic incident from Tamil Nadu exposes the darker side of this dream. Thirty-eight-year-old Senthil Kumar, an active trader, took his own life, in 2017, after suffering heavy losses in trading. In a moment of despair, he also killed his wife and their eleven-month-old twin daughters before ending his life. The cause of this devastating act was the unbearable financial losses he faced. Senthil had been trading for years, but repeated failures pushed him into debt. To recover his losses, he borrowed from a bank, only to lose that money as well. Crushed under pressure, he could not bear the weight of his debt and despair.

Unfortunately, this is not an isolated incident. Across India, there have been numerous similar tragedies – people consuming poison, jumping from buildings, or succumbing to depression due to their trading losses. Families are left shattered, and dreams are reduced to ashes.

Rare Earth Elements: The Hidden Powerhouses of Modern Technology and India’s Emerging Role

December 4, 2025

Putin visits India: Moscow seeks lifeline beyond the West

December 4, 2025

Delhi’s Air Quality Slips Back to ‘Very Poor’ Amid Persistent Winter Smog !

December 3, 2025

According to a study by the Securities and Exchange Board of India (SEBI), nearly 90 percent of traders in India lose money. SEBI, the body that regulates India’s securities and commodities market, revealed that 9 out of every 10 traders end up in losses. What is more alarming is that 36 percent of these traders are between the ages of 20 and 30, an age group that often lacks experience and stable income but is driven by enormous ambition.

In the last few years, the Indian stock market has shown strong performance. Between 2019 and 2024, the Nifty 50 index generated an annual return of about 15 percent. These impressive numbers attracted millions of new participants who wanted to make quick money. In 2019, there were around 7 lakh traders in India. By 2022, this number had jumped to over 4.5 million in the futures and options (F&O) segment alone.

The reason behind this explosive growth is simple – money. People are increasingly influenced by the glamorous world of trading, where influencers and YouTubers flaunt their wealth, luxury cars, and lavish lifestyles. They make it look effortless. But the truth is, trading is not as simple or glamorous as it appears.

Trading is a high-risk, high-reward activity. It offers the possibility of doubling or tripling your money in hours, but it can also wipe out your capital in minutes. The volatility of the market is often ignored by new traders who jump in without knowledge or skills. They believe trading is an easy route to riches, but they soon find themselves in deep losses.

The problem is made worse by social media influencers who portray trading as a guaranteed way to wealth. Many of them flaunt fake profits, expensive cars, and luxury vacations to attract followers. They sell paid courses and memberships, promising to teach the “secret” of trading success. These courses often cost between ₹1,000 and ₹25,000. Ironically, many of these so-called experts are themselves losing money in trading. They make profits not from the market but from selling dreams to others. Most are not registered with SEBI and lack the necessary qualifications to provide financial advice.

Some Bollywood celebrities have also joined this trend, endorsing trading platforms and schemes for personal gain, often misleading the public. While SEBI has banned several such individuals, new ones continue to emerge, exploiting the same loopholes.

To understand why most traders lose money, one must first understand what trading actually is. The stock market is a place where shares of listed companies are bought and sold. India has two major stock exchanges – the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). Earlier, trading required a lot of paperwork, but now, with the rise of digital platforms like Zerodha, Groww, and Angel One, anyone can open a Demat account using just a mobile phone.

While investing in shares allows people to own a part of a company and grow their wealth over time, trading focuses on short-term price movements. In 2000, the NSE introduced derivatives – financial contracts whose value depends on other assets. The most popular among them are Futures and Options (F&O). These instruments allow traders to speculate on the rise or fall of stock prices with small amounts of money. Because one can earn big profits with small investments, F&O trading has become the preferred choice for retail traders.

In Option Trading, there are two types – Call Options (which give the right to buy) and Put Options (which give the right to sell). If a trader believes a stock’s price will rise, they buy a call option; if they think it will fall, they buy a put option. If their prediction is correct, they make money. If not, they lose the entire amount.

Another form of trading, called Intraday Trading, involves buying and selling shares on the same day. Prices fluctuate constantly throughout the day, offering opportunities for quick profits. However, this also exposes traders to high risks. To encourage participation, brokers offer leverage, allowing traders to buy large quantities of shares by paying only a small portion of the total value. While leverage can magnify profits, it can also multiply losses.

Many new traders fall into this trap. They see others making quick profits and assume they can do the same. They trade impulsively, often without understanding market trends or risk management. Some even borrow money to trade, hoping to recover past losses or make a fortune. But in most cases, this leads to greater debt and despair.

Overtrading is another major reason behind traders’ losses. Many traders, after losing money in one trade, immediately place another trade to recover their loss. This behaviour continues throughout the day, resulting in repeated losses and mounting transaction costs. Every trade involves charges paid to brokers, exchanges, SEBI, and the government. Whether a trader wins or loses, these institutions earn money through fees.

As a result, while stockbrokers and exchanges profit enormously, the majority of traders are left with shrinking capital. In fact, about 80 to 85 percent of brokerage companies’ revenue comes from retail traders. The surge in F&O trading has significantly boosted the profits of companies like Zerodha, Groww, and Angel One, as well as stock exchanges like BSE and NSE. Their share prices have risen sharply, but this growth comes at the cost of countless small traders who lose their savings.

The psychological impact of such losses can be devastating. Money is not just a means of survival, it represents security, stability, and dignity. When people lose their entire savings, especially due to their own decisions, the mental toll can be severe. Anxiety, depression, and in extreme cases, suicidal tendencies, have become increasingly common among traders.

To prevent such tragedies, it is crucial for traders to act responsibly. Trading is not a lottery, nor is it a shortcut to success. It demands knowledge, patience, and discipline. One of the most important tools in trading is the stop-loss mechanism, a feature that automatically sells a stock when it reaches a certain loss limit. This helps prevent large losses and protects the trader’s capital. Sadly, many ignore this basic rule.

Traders must also avoid using borrowed money for trading. Losses in such cases can destroy not only personal finances but also family stability. Trading should be done only with surplus money, never with essential savings or loans.

Brokers, too, have a moral responsibility. Instead of focusing only on F&O volumes and profits, they must introduce safety features in their apps that help users manage risks. Mandatory stop-loss options, warnings about high-risk trades, and restrictions on leverage for inexperienced traders can protect many from financial ruin.

SEBI, as the regulator, must strengthen its guidelines. Merely banning a few influencers is not enough. Stricter enforcement and clear penalties are necessary to deter fraudsters. SEBI should also conduct awareness campaigns to educate young investors about the realities of trading—the risks, the volatility, and the importance of skill-based strategies over emotional decisions.

The growing trading culture in India mirrors a larger societal problem: the obsession with instant success. Young people today want to get rich quickly, without understanding the value of patience, effort, or financial literacy. They are misled by the glittering screens of influencers who profit from their naivety.

It is time we understand that the stock market is not a casino. It is a powerful platform for long-term wealth creation, but only for those who respect its discipline and understand its risks. The dream of becoming rich overnight may look appealing, but it is an illusion that has already cost many lives and families.

Trading, if done with skill and caution, can be rewarding. But if done blindly, it can destroy lives. The story of Senthil Kumar is a painful proof of how the pursuit of quick wealth can lead to irreversible tragedy. As a society, we must stop glorifying shortcuts to success and start promoting financial education, patience, and emotional strength. Only then can we ensure that no one else loses their family, sanity, or life to the mirage of easy money.

Mahabahu.com is an Online Magazine with collection of premium Assamese and English articles and posts with cultural base and modern thinking. You can send your articles to editor@mahabahu.com / editor@mahabahoo.com (For Assamese article, Unicode font is necessary) Images from different sources.