Mobile phones are increasingly becoming a preferred mode for many investors to trade in the stock markets.
Latest data from the stock exchanges show that the share of such trading had more than doubled in the last two years as investors, especially retail, become more confident with trading through efficient apps amid growing popularity of discount brokerages and increased use of smartphones.
On the National Stock Exchange (NSE), the share of mobile trading as a percentage of total turnover was pegged at 7.7% in April, which was more than double the 3.3% in April 2016.
On the BSE, the share of such trading rose from 1.84% to 4.49% between April 2016 and April 2018.
The rising share is further corroborated by the fact that mobile trading accounted for less than 1% of the total turnover till April 2014.
“The growth potential of mobile trading is tremendous as everything that was available on web is now in an app,” said Prakarsh Gagdani, chief executive officer, 5Paisa.com, a discount broking subsidiary of IIFL.
“While we offer app, web and a desktop application to our clients, 70% of our volume comes from our app. Further, almost 60% of our app users are from tier 1-2 cities and beyond,” added Mr. Gagdani. 5Paisa claimed that more than 70% of its app users were first time investors in the stock market.
Incidentally, the 5Paisa app recently became the first by any discount broker in India to cross one million downloads.
Not much traction
While the Securities and Exchange Board of India (SEBI) gave the regulatory go-ahead for mobile trading in 2010, there was not much traction in the early years as trading apps were not very common and the comfort and confidence factor was also low.
“Till two years back, only 10-15% of our total turnover came from our app.
“The share has now risen to 60%,” said Nithin Kamath, chief executive officer, Zerodha, one of the largest discount broking entities in India.
“The share of mobile trading is bound to increase,” said Mr. Kamath.
“We see close to two million trades on our platform daily with majority happening through the app. Our app download count is in the range of 8-9 lakh,” he added.
The Kite app by Zerodha, along with the trading apps of Sharekhan, ICICI Direct, HDFC Securities, Angel Broking, IIFL and Kotak Securities feature among the top apps in the finance category in both Android and iOS.
Interestingly, the share of mobile trading may be significantly higher if one takes into account only the retail turnover of the stock market though such break-up of data is not currently available.
