Investor Protection Measures of SEBI
Investor Protection and Role of Sebi Essay - Words
The Securities and Exchange Board of India Sebi Chairman Ajay Tyagi says the capital markets regulator is considering taking multiple steps to assuage investor concerns about the safety of their investments. The Sebi Chairman said that the IPF is woefully inadequate now, and Sebi will work with exchanges to increase the fund size. The IPF is maintained by exchanges. The IPF is used to refund investors who lose money in the event of default by brokers. Up to Rs 25 lakh are paid to investors under this arrangement. At present, exchanges collect money for IPF in two ways — from the 1 percent listing fee they receive from companies on a quarterly basis, and the interest earned on the 1 percent security deposit kept by the issuer companies, or brokers, at the time of offering securities for subscription to the public. This means that even if an investor risks losing money, the IPF may not be enough to compensate him.
Institutional investors differ widely, including with respect to their ability and interest to engage in corporate governance. For some institutions, engagement in corporate governance is a natural part of their business model, while others may offer their clients a business model and investment strategy that does not include or motivate spending resources on active ownership engagement. Save my name, email, and website in this browser for the next time I comment.
Investors are the pillar of the financial and securities Market. They determine the level of activity in the market. They put the money in funds, stocks, etc. It thus very important to protect the interests of the investors. Investor protection measures by SEBI are in place to safeguard the investors from the malpractices in shares, the stock market, Mutual Fund, etc.