Why 90% of Indians avoid the stock market despite knowing its potential
A new investor survey reveals a striking gap between awareness and participation in India’s securities markets. While 63% of households recognise at least one market product, only 9.5% actually invest in them. The findings, published by the Deutsche Aktieninstitut based on KANTAR’s research, highlight deep-rooted risk aversion and a pressing need for better financial education.
The Securities and Exchange Board of India (SEBI) surveyed 90,000 households nationwide to understand investment behaviour. Results showed that many Indians still favour traditional assets like real estate and gold. The country holds over 34,000 tons of gold—worth more than its entire GDP—while equities remain underutilised.
Despite low participation, interest is growing. A significant number of people plan to enter the capital market within the next year. Half of these potential investors come from rural areas, with most being digitally literate Gen Z and Millennials. SEBI’s investor education programmes have received high satisfaction ratings but struggle with national reach. The survey suggests expanding digital platforms to improve financial literacy. Regular learning about financial concepts—through reading, podcasts, videos, or advisors—is seen as key to building confidence. Challenges persist, however. Many avoid securities due to perceived complexity, concerns over risk and returns, and issues of trust and transparency. Even though gold prices have surged alongside the Sensex over the past two decades, equities offer greater liquidity and compounding benefits.
The survey underscores a clear divide between market awareness and actual investment. With more targeted education and digital outreach, participation could rise—especially among younger and rural populations. Addressing concerns around risk, trust, and understanding may help shift preferences from gold and property to more dynamic financial instruments.
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