Skip to content Skip to footer

The main objective of SEBI is to promote healthy and organized securities market development in India and provide protection to investors. The Government of India formally established it in 1988 and granted its statutory powers in 1992. And SEBI is the regulator for the securities market in India.

What are the main objectives of SEBI?

Investor protection – Without active investors, the capital market is useless. That is why it is essential to protect the interests of investors. Protecting the interests of investors’ means protecting them from misinformation of the company, reducing the possibility of default, etc. Thus, the top goal of SEBI (Securities and Exchange Board of India) is to provide security to investors.

The Stock Market Regulation – SEBI regulates the stock markets to ensure that adequate services are provided to all parties such as brokers, merchant bankers and other intermediaries to promote professionalism. Also, it is to ensure proper practices.

Insider Trading Checking – Insider trading refers to trading securities of a company by the individuals (such as directors, promoters, etc.) with access to non-public company information. Such individuals have access to secret information about the company. That harms the interests of common investors. Insider trading is prohibited in many countries. The argument is that other investors who have no access to information are unreasonable. SEBI has already taken significant steps to investigate insider trading.

Control over financial intermediaries – To regulate the capital market, it is essential to monitor the activities of brokers and other intermediaries closely.

Since its creation, SEBI (Securities and Exchange Board of India) has been working towards achieving its objectives with admirable enthusiasm. Progress in securities markets such as capitalization requirements, margins, setting up of clearing organizations, etc. have reduced the risk of default.

In short, the main objectives of SEBI is to protect investors, regulate stock exchanges and financial intermediaries and promote the growth and development of healthy capital markets in India.

Fair and proper functioning – SEBI is responsible for the smooth functioning of the capital market.

People started losing confidence in the stock market due to misconduct. The government felt that it is necessary to create an authority to regulate such a rule. As a result, SEBI was established by the government.

Role of SEBI-

  • The board must protect the interests of investors in securities and encourage the development and regulation of the securities market through such steps as it deems necessary.
  • It is regulating the stock exchange sector and any other financial markets.
  • Monitor and register the activity of trustees, sub-brokers, stockbrokers, share transfer agents, issuers, merchant bankers, underwriters, portfolio managers, investment advisors and other intermediaries, who are somehow connected to the securities markets.
  • To register and regulate the functioning of venture capital funds and collective investment schemes, including mutual funds.
  • Self-regulatory organizations are promoted and regulated.
  • Restrictions on fraud and unfair securities-related trade practices.
  • Promoting investor education and training of securities market intermediaries.
  • Prohibiting insider trading in securities.
  • Regulation of substantial acquisition of shares and acquisition of companies.
  • Calling for information from securities markets, intermediaries and other persons associated with self-regulatory organizations, stock exchanges, mutual funds, conducting inquiries and audits, inspections, undertaking inspections, undertakings.
  • To perform such functions and exercise such powers as may be delegated by the Central Government under the provisions of the Securities Contracts (Regulation) Act, 1956.
  • Fees or other charges for carrying out the purposes of this section.
  • Conduct research for the above purposes.
  • Determining other such functions.

Without prejudice to the rules, the Board may take any of the following steps in the interests of investors or the stock market, either for a pending investigation or inquiry or for such investigation or inquiry, for reasons to be reported in writing. The latter has been done. Complete: –

  • Suspend the trading of any security at a recognized stock exchange.
  • Restricting individuals from accessing the securities market and prohibiting anyone associated with the securities market from buying, selling, or trading securities.
  • Prevent any officer of any stock exchange or self-regulatory organization from being held in such condition.
  • Reducing and reducing income or securities in connection with any transaction.
  • No intermediary or any person associated with the securities market is to make or separate part of any transaction that is under investigation.

Conclusion: SEBI is India’s stock market regulator, that is, it makes rules and laws that strictly follow the stock market.

Role of SEBI and aims to promote stock exchange development, protect the interests of retail investors, and regulate market participants’ activities and financial intermediaries.

Functions of SEBI

  • It manages the security markets in India.
  • It analyzes the trading of shares and protects the security market from malfunctions.
  • It controls stockbroker and sub-stockbroker
  • It educates investors about the market to increase their knowledge
  • Regulatory and development of the securities market.
  • Market development.
  • To register and regulate the functioning of brokers, registrars (ROCs), underwriters, etc.
  • Registration and regulation of mutual funds.
  • Prohibition of fraud and unfair trade practices.
  • Prohibition of insider trading.

Conclusion: SEBI is the Securities and Exchange Board of India. It is the regulatory authority to raise funds from the public for capital market operations and membership of shares, debt instruments, deposits, etc. by listed public limited companies.

Show CommentsClose Comments

Leave a comment