Investors alert! SEBI issues important note of caution regarding unsolicited investment tips

Markets regulator Securities and Exchange Board of India (SEBI) has issued a note of caution to investors against unsolicited investment tips. Securities and Exchange Board of India has said that it  has come  to  the  notice  of  the  Securities  and  Exchange  Board  of  India  (SEBI)  that unsolicited messages  containing  stock  tips/investment  advice with  respect  to  listed companies are increasingly being circulated through bulk SMS, websites and social media platforms like WhatsApp, Telegram, etc.

"Such messages are sent to investors and  general public usually recommending  to deal  in specific stocks  of  listed  companies,  indicating target   prices   and   giving   fraudulent, misleading/false   information   relating   to   listed companies, inducing them to dealing these stocks," SEBI added.

Further, SEBI says, "The circulation of such misleading messages is not only detrimental to the interest of the investors but also adversely affects the integrity of the securities market."

Advice/Caution to investors from SEBI

SEBI says, "All  investors  and  the  general  public  are hereby advised/cautioned  not  to  rely  on such unsolicited stock tips/investment advice circulated through bulk SMS, websites and social media platforms."

"Investors are further advised to exercise appropriate due diligence before dealing in the securities market," SEBI added.

Notably, Zee Business did a special campaign 'Market Mafia' against such traders who try to tap investors through lucrative returns and dupe them. After Zee Business campaign, SEBI passed multiple orders on the issue and barred many such firms and their proprietors.

Recently, the Securities and Exchange Board of India (Sebi) had announced that mutual funds/AMCs shall disclose the risk-o-meter along with portfolio disclosure for all their schemes on their respective websites and on the AMFI website within 10 days from the close of each month. Mutual fund schemes will be evaluated by the investors on the basis of a 'risk-o-meter' on a monthly basis beginning January 1.

Any change in the risk-o-meter shall be communicated by way of notice-cum-addendum and by way of an e-mail or SMS to the unit holders of that particular scheme. The risk-o-meter will have six levels of risk for mutual fund schemes -- low risk, low to moderate risk, moderate risk, moderately high risk, high risk and very high risk. The very high risk category has been added to the five other categories.

Sebi, based on the recommendations of the Mutual Fund Advisory Committee (MFAC), has reviewed the guidelines for product labelling in mutual funds.