The two-month lockdown against the COVID-19 pandemic gave investors a lot of time to stay at home and trade in the capital market, especially using their smartphones, as the share of mobile trading touched record highs during the period.
Data from the stock exchanges show that the share of mobile trading witnessed a spike in April and continued in May. Further, with the recent surge, the quantum of such trades has more more than doubled in the last one year.
Mobile trading refers to transactions done in the stock market using a mobile phone. While the share of mobile trading touched a record 23% in each of the two months — April and May — on the National Stock Exchange (NSE), the share touched a high of 11.72% in April on BSE.
The quantum of rise can be gauged from the fact that the share of mobile trading was around 11% a year ago on NSE, while it was 5.35% on BSE. In terms of the number of investors, around 45% of the clients traded through smartphones on NSE in May — a significant jump from the 24% share in May 2019.
While the Securities and Exchange Board of India (SEBI) approved trading through mobile phones way back in 2010, traction was hardly visible in the initial years as investors preferred to trade through their dealers or relationship managers.
But the last few years have seen the share of mobile trading rise significantly as smartphone penetration level increased and leading brokerages started launching their trading applications. “There has been a fundamental change in the way investors trade and mobile trading has found huge acceptance,” said Prakarsh Gagdani, chief executive officer, 5paisa.com, a leading discount broking firm.
“While earlier it was mostly retail investors who traded through their smartphones, we now increasingly see high volume traders as well using their phones to trade in the market. With the technological advancements in both smartphones and the trading apps this share is only bound to increase from the current levels,” added Mr. Gagdani.