In the small and medium enterprises investment segment, there are signs of fraudulent price fluctuations, said Madhabi Puri Buch, chairman of SEBI.
He has advised that this fraudulent price fluctuation is taking place both in new share issue and trading and investors should be safe in this regard.
He said in this regard,
In the small and medium investment segment, SEBI has identified red flags for fraudulent price fluctuations; We have the technology for that. However, all this is in the early stages and the situation has not yet gotten out of hand.
SEBI is in consultation with various advisors to know the full details and to analyze the data in this regard. If any irregularities are found, a public consultation will be held on the next day.
Investors should know that small and medium segment equity investment is different from stock market investment. My understanding is that the rules regarding the information they are required to provide also vary.
The rules governing this segment, the disclosures to be made and the nature of the ‘risk’ are all different from stock market investing.
It has been made mandatory for mutual fund companies engaged in small and medium segment investment to publish information on ‘Stress Des Ding Data’ on their website from March 15.
This will help investors to determine how soon the funds will recover their investment in the event of abnormal volatility.
This is what he said..
