You can trade with any amount of capital, as long as you don’t have any pressure to generate income from trading. But if you want to trade futures and options where every contract is around Rs 5lks to 10lks, even though you need to just put a margin of around 1lk per lot or could buy options for much lesser, I’d say atleast Rs 5 to Rs 10lks in your account.
The reason for at least this much is because, as I have said in the post - the idea is to keep a stop not more than 1% of your trading capital per trade. With Rs 5lks that is Rs 5000 or say around 50 to 60 points if trading Nifty (1 lot). If you had only Rs 1lk, your stop would need to be around 10 points which is extremely tight. Closer the stop, higher the chances of getting chopped by stops.
If you are deciding to trade for a living, assuming you need to make atleast Rs 50k per month or Rs 6lks per year, I’d say atleast Rs 25 lakhs.
There are people who have done well with small capital, but the odds of that happening is much less. With lesser capital, you’d have to take riskier trades, higher the risk - higher the chance of things going wrong. I have seen many traders do well with small capital, but give it all up on a drawdown eventually as risk catches up, and if you are not following the right process it is tough to make money in the long run. Back in 2009 when we were sub-brokers of Reliance one of our clients turned his 1lk into Rs 2crores by buying out of the money call options just before we had two circuit up days after the election results. But over the next 6 months, lost the entire Rs 2crores by taking similar high-risk bets.