SEBI cautions investors on investment advices

The Securities and Exchange Board of India (SEBI) on Wednesday cautioned investors against entities offering dubious or misleading investment advice.

The market regulator has called on investors to deal only with registered intermediaries and to be wary of those promising unrealistic gains. The warning comes in the wake of a large number of advertisements promising windfall gains to investors through "tips".

Such entities promise guaranteed gains exceeding 500 per cent, apart from daily intra-day tips as also derivative strategies.
 
According to industry players, the number of unsolicited SMSes has also been on the rise, especially when markets have been on a downslide. In its release on Wednesday, SEBI said it has observed that that the number of websites offering investment advice has increased manifold.
 
The release goes on to say that investors need to realise that such advice would expose them to undue risk in use of unconfirmed information.

Market players feel the latest warning by the regulator would go a long way in educating investors against unscrupulous individuals or entities, which try to exploit the ignorance of ordinary investors.

Investors have also been advised to deal only with or through SEBI-registered intermediaries. Also, they have been cautioned to be extra careful while using information available from various media sources.

"Be aware that advice through television or print media does not mean that it is the opinion of the channel or publisher," SEBI said.
 
Finally, investors have been advised not to get unduly influenced by bull or bear runs while making investment decisions.