Primary Operations of the SEBI

Primary Operations of the SEBI

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The Securities and Exchange Board of India (SEBI) primarily carries out three functions: The Securities and Exchange Board of India (SEBI) primarily carries out three functions

1. Developmental Functions - These functions are carried out by SEBI to promote and develop stock exchange activities. SEBI performs the following as part of its developmental functions:

• Allowing internet trading through a registered stock broker

• lowering the cost of the issue for which SEBI has made underwriting optional,

• encouraging the training of securities market intermediaries,

• allowing an initial public offering (IPO) of the primary market through the stock market

2. Protective Function - Another important function of SEBI is to safeguard investors' interests and provide them with investment security. SEBI also does the following for this purpose:

• Price rigging, which involves manipulating security prices to either inflate or deflate the market prices of securities, should be prohibited.

• Insiders have access to confidential information about the business they work for. They influence the prices of securities by making use of the privilege of possessing internal information. By prohibiting insider trading, SEBI protects investors' interests.

• Companies are prohibited from preparing statements that could induce the purchase and sale of securities and mislead investors.

• Educating investors to assist them in evaluating the securities of various companies and selecting the most profitable security to maximize output

3. Regulatory Function - These are performed to manage business in stock trade. These are some:

• Registering and regulating mutual funds

• bringing intermediaries under the regulatory purview and making private placement more restrictive

• Registering and regulating the working of stock brokers

• sharing merchant brokers, trustees, and professionals associated with the stock exchange

• conducting inquiries and audits of the stock exchange on the basis of a code of conduct and set of rules