What is SEBI – Objectives, Functions

What is SEBI – Objectives, Functions must be checked by all of the people who want to become successful investors. The candidates who want to have a successful career as an investor must have proper knowledge related to the security and exchange board in India because it is one of the most common organizations which is responsible for creating good investors and also creating a good atmosphere for all of the investors. The rules and regulations are set by the organisation in order to help the investors get proper information related to the stock exchange and they can continue their careers in the stock market without having to worry about fraudulent practices. You can check out the details related to SEBI established and we have also elaborated on SEBI functions.

What Do You Mean By SEBI? 

The full form of SEBI is the Security and Exchange Board of India which is a regulatory body established by the government of India in order to regulate the shares market in India. The Organisation was established in the year 1992 by the Indian Government and was created in order to protect the rights and the interest of investors who are investing in security. This organisation was also taken into account by the Government of India in order to regulate the security market. The main objective of establishing the organisation was to regulate the stock market and the mutual funds’ function inside the country. The Security Exchange Board of India has a lot of functions that it needs to fulfil and there are a lot of objectives which will be fulfilled through the development of this organisation in India.

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Objectives Of SEBI

A lot of objectives will be fulfilled through the development of the Security And Exchange Board of India. This organisation was created in the year 1992 in order to protect the rights of the investors and help them invest in security in the stock market. You can check out the details related to the objectives of the organisation from the pointers given below. 

• Investor protection is provided by the organisation to all of the investors and this is one of the most important objectives of setting up SEBI. The investors will be provided protection of interest and they will also be provided proper guidance so that their investment is done with proper security from the Government of India itself.
• The second motive for setting up the organisation was to provide proper security to the investors. The organisation also prevents any fraudulent practices and malpractices which are related to trading.
• SEBI is responsible for regulating the activities related to the stock exchange and it also helps the people to get into investing without having to worry about the fraudulent practices which are always occurring in this type of environment.
• The third objective of developing this organisation is to also develop a code of conduct for the financial intermediaries. There are many intimidators who are responsible for investing in companies such as brokers or underwriters. If you are someone who will be appointing a broker for you as your representative when you will have a hard time and that’s when SEBI will save you. SEBI has issued a rule of conduct for all of the people involved in investment from the first thing to the end.
• The last objective of SEBI is to maintain a balance between statutory regulations and self-regulation. The authorities will be providing proper benefits related to investing to all of the investors and this will also help every investor to be more powerful. They will be able to start their own investments without having to worry about the complications that they will have to face.

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Functions Of SEBI 

There are a lot of functions that will be performed by the Security And Exchange Board of India and the investors must have proper information related to the functions of the organisations so that a can start the journey in order to become a successful investor in the future. There are mainly three functions which are available inside the organisation and you can check out the details related to these functions from the pointers given below.

Protective Function

The protective function of SEBI implies that the investor is protected and all of the rights and the duties of the investors are successfully communicated to the individual. Other financial participants are also protected by the organisation. SEBI prohibits insider trading. Insider trading is the act of buying or selling security by insiders of a company which includes directors, employees and promoters. SEBI has banned the companies from purchasing their own shares in the secondary market. Price rigging is the act of causing a natural price fluctuation. This act is also strictly banned by the organisation and it also maintains a strict watch in order to prevent such practices. SEBI promotes fair trade practices and prohibits fraudulent practices. SEBI also educates the investors by providing them with online and offline sessions related to market insights and money management.

Regulatory Function

SEBI will establish rules and regulations for the financial intimidators along with corporates and it will help in the effective management of the stock market. SEBI has already defined the rules and regulations and also form guidelines, and codes of conduct that should be followed by the corporates and the financial investors. SEBI has also regulated the procedure of taking over a company and conducting inquiries. SEBI will regulate brokers and merchants so that they do not indulge in fraudulent practices.

Development Function

SEBI has taken steps in order to provide knowledge to all of the investors who are setting their food in the financial market. There are a lot of development functions which are performed by the organisation such as the training of intermediate who are a part of the security market. SEBI will also help beginners by making them aware of the online and offline sessions available by the organisation. There are also a lot of different types of materials available on the official website of the organisation for all of the people related to the financial markets. 

Purpose Of The Organisation

The main purpose behind setting up SEBI was to provide an environment which is easy for the allocation of resources. It also provides practices and a framework for the people so that there is no need to worry about the study materials that are required by the investors in order to start their first investment in the country. For investors, SEBI will provide proper material which will have accurate information and will be maintained on a regular basis. SEBI will provide a marketplace that can be utilised for raising funds for your company. The organisation will also provide proper opportunities through the organisation through which they will be able to set boundaries and help all of their investors.

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