3 Mins

What is SEBI and its function?

The Securities and Exchange Board of India (SEBI) is a regulatory body. It was founded on April 12, 1992, under the SEBI Act, 1992. It is responsible for the regulation of the Indian securities and capital markets. 

Its main functions are the following:
  • Protect the interest of the traders and investors.
  • Promote development of the securities market.
  • Regulate the securities market.
  • Matters connected to any of the above.

What is the full form of SEBI?

The SEBI stands for the Securities and Exchange Board of India. It is the regulator of the securities and commodity market in India owned by the Government of India. What are the main objectives of SEBI?

SEBI is responsible of regulation of the Indian capital market. The following are the main objectives of SEBI:

  • To safeguard the interest of the investors.
  • Ensure the Indian capital market is transparent to its investors.
  • The capital market function in a systematic manner. 

Why SEBI is formed?

SEBI was established with the objective of safeguarding the investor’s interest, regulate the capital market, and establish a transparent market. Moreover, it has achieved it by introducing rules and regulations, a mandatory revelation of information, etc

What are the powers of SEBI?

SEBI holds three main powers w.r.t. to the Indian capital market:
  1. Quasi-Judicial. To deliver judgments on practices relating to fraud as well as unethical practices.
  2. Quasi-Executive. To implement the regulations and judgments. Additionally take legal action against the violators. To inspect the Books of accounts and other documents in case of any violation of the regulations.
  3. Quasi-Legislative. To frame rules and regulations to protect the interests of the investors. Few instances are insider trading regulations, listing obligation, as well as disclosure requirements. 

What is IPO full form?

The IPO stands for Initial Public Offering. It is a process through which a company can raise funds publicly by offering its shares. By owning the shares of a company an investor becomes a part-owner of the company. Any individual who is eligible to enter into a contract can apply for an IPO. However, he/ she must hold a Demat account as all allotments are done only in Demat form. 

Latest SEBI News

Bajaj Finserv has received approval to start a mutual fund company in India, and its shares have gone up 7.91%.

Bajaj Finserv has received approval from SEBI to start an AMC and will be the latest entrant to the Indian mutual fund industry. Since the news, shares of the company rose 7.91% and reached a 55-week intraday high. Though most assets are covered by top 10 fund houses, still there is a huge opportunity for new players. However, market participants predict tough competition.

Published: 25th Aug 2021

SEBI Requires AMCs to Invest in Their NFOs Based on Risk Level

SEBI amends its regulation mandating investment in NFO based on risk level for AMCs. This will ensure ‘skin in the game’. The existing rule requires an AMC to invest 1% or Rs 50 lakhs whichever is lower. SEBI has yet not quantified the minimum amount of investment. However, experts speculate that AMCs will have to invest more in equity funds as compared to debt funds.

Published: 19th Aug 2021