Big News for Stock Market Traders: NSE Just Made Trading Cheaper!
Imagine you want to buy a car, but the dealer says you must buy 10 cars at once. Expensive, right? That’s exactly what was happening in India’s stock market. But guess what? The rules just changed!
On October 3, 2025, the National Stock Exchange (NSE) announced a game-changing move — the reduction in the minimum lot size for futures and options (F&O) trading. This change will take effect from October 28, 2025, making F&O trading more affordable and accessible for retail investors.
What Actually Happened?
Let’s break this down in simple terms.
When you trade F&O, you can’t buy just one share. You have to buy a “lot” — which is a bunch of shares together. Think of it like buying eggs — you can’t buy just one egg, you have to buy a dozen.
Until now, these “lots” were getting bigger and more expensive. But NSE just made them smaller.
Here’s what changed:
These revisions may seem minor, but they’re a big win for traders. With smaller lot sizes, entry costs drop — for instance, trading Nifty 50 now needs about ₹2.5 lakh less, and Bank Nifty about ₹2.75 lakh less — making F&O trading more affordable and accessible for retail investors.
Why Should You Care?
Here’s the simple truth: Trading just became more affordable.
Before this change, if you wanted to trade Nifty 50, you needed about ₹18.75 lakh just for one contract. That’s a lot of money! Most regular people don’t have that much cash lying around.
Now, you need only about ₹16.25 lakh. That’s still big money, but it’s ₹2.5 lakh less than before.
Think of it this way — if pizza slices got smaller but cheaper, more people could afford to buy pizza. The same thing happened here.
Who Benefits the Most?
- New Traders: If you wanted to start trading but found it too expensive, this is your chance.
- Small Investors: You can now trade with less money and take smaller risks.
- Everyone: More people can now participate, which means better trading for everyone.
When Does This Start?
Here’s the timeline you need to remember:
What Traders Need to Know
- If you’re already trading: Your current positions won’t change immediately. You can keep trading with the old lot sizes until December 2025.
- If you’re planning to start: Wait until after October 28 to get the benefit of smaller lot sizes.
- Important: Your broker will update their systems automatically. You don’t need to do anything special.
The Real Impact on Your Wallet
Let’s talk about real numbers. If you were trading Nifty 50:
- Before: You needed about ₹2 lakh as margin money
- Now: You need about ₹1.77 lakh as margin money
- Savings: ₹23,000 less cash needed!
That ₹23,000 can stay in your bank account earning interest or be used for other investments.
Why Did NSE Make This Change?
NSE wants more people to trade. When lot sizes get too expensive, only rich people can afford to trade. That’s not good for the market.
By making lots smaller:
- More people can participate
- Trading becomes more active
- Prices become more fair
- The market works better for everyone
It’s like making movie tickets cheaper so more people can watch movies.
What This Means for the Future
This change shows that regulators are listening to traders’ concerns. For years, people complained that F&O trading was becoming too expensive for regular investors.
Now, the door is opening wider. More people means more trading. More trading means better prices. Better prices mean everyone wins.
Should You Start Trading Now?
Hold on! Just because trading got cheaper doesn’t mean it’s risk-free.
F&O trading is still risky. You can lose money fast. Even with smaller lot sizes, you can lose everything if you don’t know what you’re doing.
Before you start:
- Learn how F&O trading works
- Practice with paper trading first
- Never invest more than you can afford to lose
- Consider taking a trading course
Also Read: Are You Trading Too Often? Beware the Dangers of Overtrading!
Simple Tips for New Traders
- Start Small: Even though lot sizes are smaller, start with just one lot.
- Learn First: Understand how futures and options work before putting real money.
- Use Stop Losses: Always set a limit on how much you’re willing to lose.
- Don’t Borrow: Never borrow money to trade F&O.
The Bottom Line
NSE’s decision to reduce lot sizes is great news for traders. It makes the market more accessible and democratic. More people can now participate without needing huge amounts of money.
But remember — cheaper doesn’t mean risk-free. F&O trading is still a serious business that requires knowledge, skill, and careful money management.
The door to F&O trading just got wider. Whether you walk through it or not is your choice. If you do decide to enter, make sure you’re prepared.
This change proves that the Indian stock market is evolving to serve everyone better. That’s something worth celebrating!
Disclaimer: This article is for educational purposes only. F&O trading involves significant risks. Please consult with a financial advisor before making any trading decisions. Past performance does not guarantee future results.
FAQs:
NSE has reduced lot sizes for major indices: Nifty 50 from 75 to 65, Bank Nifty from 35 to 30, Nifty Financial Services from 65 to 60, and Nifty Mid Select from 140 to 120. Nifty Next 50 remains unchanged at 25.
The new rules are effective from October 28, 2025 (end of day). Weekly and monthly contracts will continue with old lot sizes till December 23 and December 30, 2025, respectively. All new contracts from January 2026 will follow the revised lot sizes.
NSE periodically adjusts lot sizes to keep contract values in a standard, affordable range. This helps improve accessibility, liquidity, and risk management for a wider set of traders, especially retail participants.
Smaller lot sizes reduce total contract value and typically lower the margin needed. For example, the Nifty 50 contract value drops roughly from ₹18.75 lakh to ₹16.25 lakh, and margin may reduce from around ₹2.04 lakh to about ₹1.77 lakh, depending on market levels and broker risk systems.
Yes. Existing weekly and monthly contracts will continue with old lot sizes until their last expiries on December 23 and December 30, 2025. From January 2026, all new contracts across maturities will use the revised lot sizes.
Yes. Existing weekly and monthly contracts will continue with old lot sizes until their last expiries on December 23 and December 30, 2025. From January 2026, all new contracts across maturities will use the revised lot sizes.
The information provided in this reference is for educational purposes only and should not be considered investment advice or a recommendation. As an SEBI-registered organization, our objective is to provide general knowledge and understanding of investment concepts.
It is recommended that you conduct your own research and analysis before making any investment decisions. We believe that investment decisions should be based on personal conviction and not borrowed from external sources. Therefore, we do not assume any liability or responsibility for investment decisions made based on the information provided in this reference.
