International Journal For Multidisciplinary Research

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Awareness, perception and participation of Retail investors in the futures and options Market: A case study of Muzaffarpur, Bihar

Author(s) Dr. MD. Zafar Alam
Country India
Abstract The Indian derivatives market has emerged as one of the fastest-growing in the world, with Futures and Options (F&O) playing a pivotal role in portfolio management, speculation, hedging, and price discovery. Yet, participation by retail investors is uneven across Indian regions. This study examines the awareness, perception, and participation of retail investors in the F&O market in Muzaffarpur, Bihar - a commercially vibrant but semi-urban district that represents a large segment of financially transitioning India. Despite rapid digital onboarding by brokers and mobile trading apps, investors outside metropolitan centers face barriers including low financial literacy, limited formal advisory access, language challenges, and a perception that derivatives are - for big players only. Primary data were collected through a structured questionnaire administered to 150 retail investors across key market clusters in Muzaffarpur (Town Hall area, Mithanpura, Bela Industrial Zone, and Pokhraira Bazaar). Awareness scores, perception indicators, and self-reported participation in F&O trading were analyzed using descriptive statistics and correlation tests. Secondary data from SEBI, NSE, BSE, and behavioral finance literature support interpretation. Results show that awareness levels are modest and strongly associated with willingness to trade derivatives; perceived risk and product complexity deter participation. Policy measures recommended include targeted vernacular financial literacy drives, guided app interfaces for first-time derivatives users, and expansion of SEBI/NSE investor outreach in Tier-2 and Tier-3 geographies. The study contributes to regional investor behavior literature and offers actionable inputs for inclusive capital market development in India.
Keywords Retail Investors; Futures and Options; Derivatives Market; Financial Literacy; Investor Perception; Muzaffarpur; SEBI; Behavioral Finance
Field Mathematics > Economy / Commerce
Published In Volume 7, Issue 4, July-August 2025
Published On 2025-07-25
DOI https://doi.org/10.36948/ijfmr.2025.v07i04.52065
Short DOI https://doi.org/g9vpzr
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