Question

SEBI is the watch dog of security market. Do you agree? Give three reasons in support of your answer.

Answer 1

Yes, I agree as SEBI regulates and protects the interest of investors. SEBI was established in 1988 and given a statutory status in 1992, to protect the investors from the fraudulent malpractices, rampant in securities market before 1988. As a watch dog, it regulates the market and protects the investors by keeping a check on various manipulative activities by performing the following functions:

(i) Regulates takeover bids by companies.

(ii) Prohibits fraudulent and unfair trade practices.

(iii) Undertakes several steps to protect the investors, e.g. calls for infromation by conducting inspections, enquiries and adults of the companies.