F&O Volumes May Dip Post Prop Trading Curbs, Retail Participation to Hold: JM Financial

• New regulatory steps on proprietary trading could impact derivatives volumes in the near term, says Raghvesh of JM Financial.
• Proprietary derivatives volumes may see a 15% impact, but retail participation is expected to remain stable due to higher return potential.
• Brokerages heavily reliant on F&O, like Angel One and Groww, might face near-term earnings moderation; firms with lower exposure less affected.
• Despite regulatory tightening, current stock market weakness presents good buying opportunities, with select brokerage stocks attractive.
• Long-term shift of household savings to market-linked financial products, mutual funds, and SIPs is expected to continue, benefiting wealth management and asset management firms.