Role Of SEBI In the Stock Market

Role Of SEBI In the Stock Market

SEBI is Security Exchange control Board of India and it is a board for the regulation and development of the stock market. It was established as a non-statutory board and later it was made a statutory board. SEBI has many major roles in the stock market and it will help the traders to deposit the money in Qprofit software. Let us discuss those objectives in this article.

  1. It is mainly used for the protection of the interest of the traders.
  2. In capital markets, it will be very helpful to make the intermediaries or middlemen more professional.
  3. It is used to create a well financial condition in the market so that the companies will raise the long-term
  4. Protection of interest:

The SEBI will create some rules and regulations to protect the investor’s interest. It will notice whether companies are strictly following the rules put by the SEBI. Some brokers will do some bad activities and the board will take care of all those complaints.

  1. Restriction on insider trading:

The SEBI strictly restricts the insider trading activities of the investors. It controls the communication that is related to insider trading. It controls the traders that there should be no work done by some traders on behalf of others.

  1. Regulates stock broker activities:

There is some rule put by the SEBI with respect to brokers and sub-brokers. When a broker or sub-broker is not having registers with the SEBI, then they will not allow to sell or buy securities in the market. The brokers are supposed to keep a separate account for themselves and another account for their clients to avoid confusion. The books of the brokers should be audited and the reports should be filed with the SEBI board.

  1. Regulates merchant banking:

SEBI has some regulations with the merchant banking. The regulations are based on the registration and the submission of the results which are on a quarterly basis.

  1. Dematerialization of shares:

The demat of shares are introduced almost in all the shares in the market.

  1. Guidelines on capital issues:

The SEBI has some guidelines prepared on capital issues for the new companies.

  1. Regulates working of mutual funds:

The SEBI sets some rules for the mutual funds. If the company fails to follow those rules set by the SEBI, then SEBI will cancel the registration of a mutual fund for the company.

  1. Monitoring of stock exchange:

The SEBI will monitor the stock exchange for the improvement of the working of stock markets.

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