From 2021, I had been tweeting about the risks to the broking business, but somehow I kept getting surprised on the upside. But starting around October last year, all the risks I was thinking about crystallised. First came the STT increase on options, then the removal of exchange transaction charge rebates, and a reduction in weekly expiries. In addition to this, there was a significant decline in market activity. Due to all these factors, our revenues and profits suffered a decline. This year, we are seeing a drop in broking revenues of about ~40%.

Having said that, I’ve never looked at quarterly or even yearly growth because Zerodha is perhaps the only broker in the world with the luxury of thinking long-term and continuing to do what’s right for our customers despite short-term business volatility. This is in large part because we don’t have any external investors or pressures to answer to.

Despite the financial headwinds, the last year was also a good year in a lot of ways. In terms of products, we launched several important features.

More importantly, there’s also a lot of work in the background that’s not visible on the front end. We’ve become more ambitious at Rainmatter and we’ve increased our investments to support Indian founders building things for India. This has become all the more important given the current geopolitical environment, and we will continue to back more homegrown startups. It’s the same at Rainmatter Foundation as well. We continue to back individuals and organisations working on important issues and causes. We also set up a new Rs 100 crore rewilding fund and have taken up our first project in Maharashtra.

So, yeah, it’s been an interesting year, to say the least. As the old Chinese curse goes: “May you live in interesting times.”

Just about 10 days left to file your taxes. While figuring out taxation for trading and investments is usually a nightmare, we’ve made it super easy. I think our tax statements are easily the best in the industry by a mile.

On Console, you’ll find all the statements you need to file taxes for your trades and investments:

Tax P&L statement with trade-wise charges, turnover across all segments, equity and non-equity segregation, capital gains split for pre- and post-July 23, 2024, and more.

Ability to download one year of contract notes at a time. Full tradebooks.

Various filters to make it easy to figure out STCG (short-term capital gains) and LTCG (long-term capital gains).

And more…

If you need help filing your taxes, we’ve also partnered with Quicko to make the process even smoother.

📢We have an update for NRIs.

ICICI Bank is now among our partner banks for opening an NRE–PIS account and linking it to your Zerodha NRI account, along with HDFC Bank, IndusInd Bank, IDFC FIRST Bank, Yes Bank, and Axis Bank.

What’s a PIS account?

PIS (Portfolio Investment Scheme) is a bank-managed account that allows NRIs to buy and sell listed shares in India. The partner bank obtains the RBI PIS permission and routes all trades through this account.

Why does this matter?

Under RBI rules, NRIs can invest in Indian equities only through either the PIS route or a Non-PIS route. The PIS setup is needed if you want to use funds from your NRE account to invest in equities.

At Zerodha, we provide both options

PIS: Funded through your NRE or NRO account. Proceeds are fully repatriable (transferable overseas). Requires an account with one of our partner banks.

Non-PIS: Funded through your NRO account. Proceeds are non-repatriable beyond $1 million per year. Available with any bank, and this route comes with fewer restrictions and lower costs.

Learn more: https://support.zerodha.com/category/account-opening/nri-account-opening/pis-non-pis/articles/difference-between-pis-and-non-pis

You can open your NRI trading and demat account online. 

Instant WhatsApp stock alerts, an investment ideas dashboard, a personalised investment timeline, custom sector indices, and multi-portfolio tracking.

Here’s a look at cool new features by Tijori. 

Trading platforms are ridiculously complex. One hiccup anywhere from exchange connections to cloud servers can create an issue. Over the years, we’ve built tons of safeguards and redundancies, but we’re still paranoid.

Apart from all of this, we’ve built a new emergency trading mode using WhatsApp. In case of a disaster scenario, which we hope never happens, and the Kite web and mobile both become inaccessible during market hours, this backup mode will allow you to cancel orders and exit positions. It runs on a completely separate infrastructure and is designed to be independent of Kite. Link to the post. 

Watch this video to know how to enable it.

One critical aspect of the brokerage business most people are unaware of is the sheer underlying complexity.

At a high level, we integrate with multiple stock exchanges, depositories, RTAs, banks, and others. Each of these integrations (hundreds of APIs and file exchanges) has been non-uniform and non-standard, resulting in massive amounts of technical and operational complexity. These are completely invisible to a broker’s clients.

A great example of quiet, systemic backend work yielding significant impact is the multi-year exercise SEBI undertook to standardise data exchange across market entities—the Unified Distilled File Formats (UDiFF).

The same data that was represented inconsistently across three exchanges, for instance, was unified to be consistent in a single format, across numerous data structures.

As a result of this, we ended up removing 60%+ of the code that was required to maintain these separate data formats, significantly reducing technical and operational complexity and risk.

Along with it, we saw huge efficiency gains. For instance, a nightly data import process went from taking 40 minutes to 30 seconds. Ultimately, this one SEBI project has cleared technical debt accrued over decades, significantly reducing technical and operational risk systemically in Indian capital markets.

These boring, invisible, background updates are often far more meaningful, impactful, and directly beneficial to retail clients than most shiny frontend features.

At Zerodha, we take technical and operational debt very seriously. Constantly reducing its buildup and giving these invisible improvements as much importance, if not more, as frontend features, is our engineering philosophy. Our priority is to make the underlying systems robust and reliable for the next decade, rather than focusing on what can be released in the next quarter.

The number of NRIs who want to invest in India but don’t because of the complex account opening process is quite high. NRI accounts are also much higher in value compared to resident Indian accounts, by at least 10 times.

Hardly a day goes by without emails or messages from NRIs asking us to make account opening easier at Zerodha. The paperwork today is onerous, especially the need to visit an embassy.

Recently, SEBI took a step in the right direction by removing the need for a CP (custodial participation code) to trade in F&O. So, we are reducing brokerage on all non-PIS accounts to Rs 50 or 0.5%, whichever is lower.

However, given the operational complexities, NRIs trading through PIS will continue to pay Rs 200 or 0.5%, whichever is lower.

We also just launched a new onboarding flow for NRIs, which simplifies the account opening process.

After 20+ years of being in the markets, one thing has become crystal clear to me: most investors should just invest in low-cost equity, debt, and gold index funds and do something useful with their lives. 😬 Trying to pick the “best fund” or “best asset class” is largely a waste of time and energy.

What most investors don’t realize is that they’d get far better returns by focusing on maximizing their earning potential rather than obsessing over picking the “best stocks and funds.” The odds are stacked against them anyway.

That’s exactly why we launched the ZerodhaAMC Multi Asset Fund. This single fund gives investors exposure to large-cap and mid-cap equities, government bonds, and gold all in one place. Investors don’t have to worry about rebalancing, tax complications, or managing multiple investments.

There was a famous study from Fidelity that found that their best-performing accounts belonged to people who were either dead or had forgotten they had accounts. The study was made up, but the point still stands.

Companies have started announcing results for the first quarter of FY 2025–26. Here are three simple ways to stay updated:

First, on Kite. If you’re tracking a stock in your Marketwatch or own it in your holdings, you’ll see an event tag when the results are close to being announced. Just tap the stock, go to the ‘Event’ tab in the Fundamentals widget, and you’ll get a quick snapshot, from valuations and revenue breakdowns to peer comparisons and shareholding patterns and more.

Second, check the Portfolio Timeline on Console, powered by Tijori. It’s like a live feed for your portfolio, showing earnings announcements, exchange filings, and other key updates about the companies you own.

Third, for broader coverage, follow @marketalertsz on X, where you get instant summaries of key exchange filings.

Interesting experiment by Elm Wealth: 118 finance students were given tomorrow’s WSJ front page 24 hours before the news broke. You’d expect easy profits. Instead, half lost money and 16% went completely bust.

It wasn’t because their predictions were wrong. They called market direction correctly 51.5% of the time. That’s better than chance.

The problem? Position sizing.

Many students bet huge portions of their portfolio on a single trade. Some used 20x, even 60x leverage. When they were right, they made money. But when they were wrong they blew up. All it took was a single misstep.

Meanwhile, five experienced traders ran the same simulation. Same info. Very different outcome: +130% average returns. Why? They knew how much to risk. They bet small when uncertain, and big only when the odds were clearly in their favor. That’s the art of position sizing.

Here’s the core lesson: Even if you could predict the future, it wouldn’t save you from poor risk management. Trading isn’t just about being right. It’s about surviving long enough to stay in the game.

Most retail traders obsess over predictions. But smart money obsesses over how much to bet when they think they’re right—and how to protect themselves when they’re wrong.

Because in the markets, being right means nothing if you go bust before you’re proven right.

Our support portal has a new look.

It’s now easier to navigate, and we’ve made several behind-the-scenes improvements to help you find what you’re looking for faster.

Did you know?

Our support portal includes over 1,300 articles that explain not only our products but also simplify other market and process-related topics for easy understanding.

Starting today, electricity futures are live for trading on Indian exchanges. MCX has started trading in these contracts from today, and NSE will start from Monday, July 14, 2025.

These contracts will trade from Monday to Friday, from 9:00 AM to 11:30 PM (11:55 PM during the U.S. daylight saving period, November to March).

Here’s a quick explainer on electric futures trading from today’s Daily Brief by
@zerodhamarkets👇

A futures contract lets you lock in a price today for electricity you plan to buy or sell later.

This gives power producers, distribution companies, and even speculators a new tool: the ability to secure a future power price, on a regulated exchange, without having to create or take delivery of that power.

Until now, most electricity in India was sold via long-term Power Purchase Agreements (PPAs) between generators and discoms, covering the base demand through 5, 10, or 25-year contracts.

But demand and supply aren’t constant. Heatwaves, monsoon failures, or outages cause sudden spikes or drops. That’s where short-term markets like IEX’s day-ahead and real-time trading came in, allowing utilities to buy/sell electricity for immediate delivery.

However, those are physical markets. You’re actually buying electricity. The new electricity futures offered by MCX and NSE are purely financial contracts. No physical power changes hands. It’s a cash-settled bet on what power prices will be in a future month.

So, why aren’t electricity futures being offered on IEX, India’s biggest power exchange?

It comes down to regulation and who governs what. In India, physical power markets are regulated by CERC, the Central Electricity Regulatory Commission. But derivatives are financial instruments. So they come under SEBI’s jurisdiction.

Since IEX is a CERC-regulated entity. It can’t offer SEBI-regulated financial products like futures. That space is reserved for SEBI-approved exchanges like NSE and MCX.

So, what’s the point of these contracts? At a basic level, it’s about hedging. Power generators can lock in future selling prices. Discoms can protect themselves against price spikes. Speculators can bet on market trends.

This is especially useful for renewable generators. Since solar/wind supply is variable, they often rely on selling in the spot market, where prices fluctuate wildly. Sometimes, spot rates even fall to zero. Electricity futures can provide price certainty for these players.

 

We covered this in detail in today’s Daily Brief; watch on YouTube, read on Substack, or listen on Spotify, Apple Podcasts, or wherever you get your podcasts. All links here.

 

Here are key contract specifications👇

One of the biggest challenges in building a financial services business is that the incentives are often skewed toward doing what’s good for the business and not for the customer. It’s very hard to consistently put customers first.

This is one of the main reasons why finance apps are full of dark patterns, more than almost any other category. Dark patterns are design tricks used in apps and websites to make you do things that are not in your best interest. From pointless “gamification” and casino-like features to manipulative notifications, lack of transparency, and pushing harmful financial products, many platforms are, in some ways, incentivised to work against their own users.

“Show me the incentives, and I’ll show you the outcome.” – Charlie Munger

One reason Zerodha users trust us with their money is because we’ve avoided these practices from day one. Doing what’s right for our customers has always been at the heart of our philosophy.

Read this post for more.

We recently recorded a video breaking down the most common dark patterns in finance apps.

A year ago, we started The Daily Brief, a podcast simplifying 2-3 most interesting stories in finance, business, and the wider economy. Since then, it has quickly become one of India’s most popular podcasts, reaching over 50,000 people across video, audio, and text formats.

Here’s a quick note on what we’ve been up to.

We often hear stories from investors, on social media and in real life, about holding physical share certificates; even discovering ones that belonged to their parents or grandparents.

Today, SEBI no longer permits the transfer of physical shares, except in specific cases like inheritance. So, holding shares in demat form isn’t just more convenient and secure, it’s essential if you want to do anything with them.

We see this as a real issue and want to help. We’ve set up a dedicated team to assist with the dematerialisation process. You don’t need to be a Zerodha customer or even have an account with us; we’ll still help you convert your physical shares to demat. If you’re unsure how to start, just raise a ticket below.

The number of fraud cases involving scammers impersonating brokers and asking for money to be transferred to random accounts has skyrocketed.

To protect investors, SEBI has introduced a new UPI security feature. All legitimate fund transfers will now only go to verified UPI handles like: brokername@validbank (as shown in the image). We @zerodhaonline will implement this soon, and this should help reduce fraud incidents significantly.

~11% of all retail and HNI holdings are in Zerodha demat accounts. Grateful for the incredible trust our customers place in us.

The way we communicate and manage money has changed completely. We communicate through WhatsApp, Instagram, Telegram, etc. Invest, borrow, and send money instantly using various apps.

But this convenience has also increased the risk of falling victim to scams, as they have become harder to spot, better disguised, and often look like genuine opportunities.

Here’s a look at some of the most common scams and how you can stay safe. 

Our MTF (Margin Trading Facility) book grown to ~Rs 3,000 crores within 6 months of launch. Half the time, we were in a bear market-like conditions.

The good news is that our clients are sitting on a combined profit on their MTF position. I don’t know if it will eventually be like this, but at least for now, they are profitable.

By the way, the MTF component of a business, which we had resisted for so long, has acted as a revenue hedge for the business against a drop in options business and a drop in transaction charge revenue.

We have been able to keep the brokerage rates and DP charges the same as before the regulatory action, thanks to MTF.

And we just improved the Margin Trading Facility (MTF) feature on Kite:
* Easily convert MTF positions to delivery.
* Increased limits: Trade up to ₹5 crore per stock and ₹25 crore per account.
* Use MTF for over 1,300 stocks with up to 5X leverage.
* Place GTT and AMO orders.

It’s been 18 months since the first fund launch of Zerodha Fund House with smallcase. The idea was to offer simple and cost-efficient index funds and ETFs and stay direct only. Despite not being loud about the AMC, 7 lakh investors have saved ₹6,400 crores in our funds.

The hero fund is LIQUIDCASE ETF at ₹4,700 crores, and this is all in 15 months. LIQUIDCASE has to be one of the most successful Indian retail ETF launches ever. Vishal Jain and team have done a fabulous job building out the fund offerings.

Mutual fund investments are subject to market risks. Read all scheme-related documents carefully. 😐

A couple of years back, a new team member pointed out that we didn’t have a good strategy for video content, and he was right. In hindsight, it was obvious 😀 We were publishing educational content in text form on Varsity, Z-Connect, etc., but we weren’t focusing on videos. We had become like an incumbent, not adapting to the times.

Since then, we’ve put in significant efforts to publish high-quality video content on all things finance, and slowly but steadily, we’ve become the go-to destination for people to understand finance and markets.

Our video strategy is the same as it always was: share everything we know and publish content that people will genuinely find useful, regardless of whether it helps Zerodha or not, and whether it gets views or not.

But since the world judges a video by views, and we have never done any performance marketing, our numbers over the last approximately 2 years. And this is just on YouTube, doesn’t include Insta, Twitter, LinkedIn, etc.

Zero1ByZerodha – ~ 6 crore views Zerodha Varsity – ~2.4 crore views Markets by Zerodha – ~1 crore views Zerodha – ~1 crore views

All of this excludes Nikhil’s WTF, which he has been hitting out of the park, along with all the amazing creators in the Zero1 network.

Why mention it today?

Because Zero1 just hit 500k subscribers in less than 2 years, and maybe we should acknowledge that our video strategy, which was lacking, is in place. 😬

So yeah, thanks to Prateek Singh, Swati Harish, Karthik Rangappa, Bhuvan,Sagar Gudekote, and everyone responsible for…

Today saw the first SME IPO that disallowed retail investors (bids less than ₹2 lakhs) from participating.

In 2024, SEBI proposed new SME IPO rules through a consultation paper. The changes were finally incorporated into the Issue of Capital and Disclosure Requirements (ICDR) regulations in March 2025.

Let’s break down what has changed.

What’s New?

1. SEBI has proposed increasing the minimum application size for SME IPOs from ₹1 lakh to ₹2 lakh. This change aims to limit participation by smaller investors and attract only those with higher risk tolerance. Unlike mainboard IPOs that have a retail category with lower minimum investments, SME IPOs have always maintained higher entry barriers to ensure participation by serious, committed investors. The increased threshold reinforces this approach by further filtering out casual retail participation.

2. Lottery for HNI Allotment: For book-built SME IPOs, the Non-Institutional Investor (NII) category, which includes HNIs, now uses a “draw of lots” instead of the old proportionate allotment. This change was already in place in mainboard IPOs, and SME HNI bids were getting differential treatment. This is bound to reduce bids in the SME space.

Why is today’s SME IPO launch the first to exclude retail participation entirely?

SEBI announced new SME IPO rules in March 2025. There have been about 30 SME IPOs since then.

However, since the new rules were only valid for companies who filed their IPO prospectus with the exchange after March 2025, anyone who went public after March 2025 but had filed their prospectus earlier could still invite retail participation. This can get confusing for investors over the next few weeks, since a prospectus filed stays valid for a year.

Although the future path is set, and over time, all SME IPOs will have a minimum investment above Rs. 2 lakhs, for now, some can have a minimum of Rs. 1 lakh, whereas others will follow the new rule. The exchanges may issue a roadmap to help clarify this.

Here is the ICDR amendment for reference – link.

We’ve added more equity and debt indices for comparison on the Portfolio Performance Curve on Console.

Fun fact: This screenshot is the actual portfolio performance of a colleague. He has 2100 stocks (~Rs 21lks) in his portfolio, and with great effort and smarts, he’s managed to underperform a government bond index. 😬

We just revamped the Kite MarketWatch and made it much cooler.

1. You can now create custom groups for instruments in your MarketWatch. You can group them based on strategies, themes, sectors, etc. For example, you can have a custom group with all the contracts required for an options strategy like an Iron Condor.

2. We’ve also added pre-built watchlists with all the stocks of broader indices, sector indices, and thematic indices like Bank Nifty. With a couple of clicks, you can quickly see what’s happening within an index.

3. You can now create 25 different watchlists with 250 stocks per watchlist.

There’s a lot more. Check out this post for more.

We just launched fundamental stock pages powered by Tijori. If you are tracking a stock and want to get a quick snapshot of the financials, news, peer comparisons, and any potential red flags, then this will help.

To dive deeper, you can always go to Tijori’s site.