Stock market trading is one of the easy ways to make money, but there are several risks that come with it, and one of them is becoming addicted to it. Recently, a chartered accountant raised concerns about the risks associated with becoming addicted to trading, especially in the face of significant financial losses. A chartered accountant based in Assam highlighted a case involving one of his clients—a third-year BTech student without any regular income—who reported a loss of Rs 26 lakh from trading in futures and options (F&O) during the fiscal year 2023-24.
The CA told Moneycontrol, “Last year, he lost Rs 20 lakh in trading.” He also mentioned that two years ago, the student contacted him through Facebook, where he provides financial guidance and seeks assistance filing income tax returns.
He told the publication that the student’s parents are separated, with his mother running a hotel business, though neither of them is aware of his situation. He has no income and has taken personal loans from financial apps, borrowed money from friends, and withdrawn funds from his parents’ accounts without their knowledge.
He explained that the student has been relying on financial decisions influenced by social media and peers. “One of his friends made Rs 1 crore last year from F&O trading… I have seen the statement. He was influenced by that and from what he heard financial influencers say on social media,” the CA said. Following the initial year of losses, the CA emphasised that he had strongly advised the student to cease seeking quick financial gains. Despite seeming initially convinced, the student returned to file his income tax returns with an even more significant loss this year.
“When I asked him the reason, he said he was addicted to trading and has been unable to quit it… Influencers on Instagram and Telegram are selling dreams of being rich quickly, and it’s the innocent, such as this student, who fall prey to this,” he said. The CA highlighted that this time, the student pledged not to indulge in such trades anymore as he is nearing graduation and intends to prioritise earning money instead.
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