Only 36% investors have sufficient knowledge of the stock market, says Sebi chairman, shares 4 tips to prevent scam

Securities and Exchange Board of India (Sebi) Chairman Tuhin Kanta Pandey issued a strict warning on Monday about the rising wave of financial scams aimed at retail investors. He pointed out that only a small part of the investors have a high or moderate knowledge of the securities market, making it much vulnerable to unscrupulous actors.

“Only 36% of the investors have a high or moderate knowledge of the securities market. This knowledge gap is a vulnerability that exposes our investors to risks and makes them susceptible to fraud,” said the Sebi chef, even while he recognized the growing influence of Indian investors.

A SEBI survey showed that 63% of Indian households translating into 21.3 crore households are aware of at least one product for securities market. On August 31, the number of unique investors was 13.4 Crore.

“The rise of the Indian investor has been celebrated in recent years, and rightly so. This has happened on the back of increased access, simplified on board and a broader consciousness has led to the number of unique investors in the Ecosystem of the securities market,” said Pandey.

He spoke at World Investor Week 2025 organized by the NSE. The theme for this year was’ Fraud and scams prevention and basic principles of investing.

Also read: Sebi is planning to increase a term of office, maturity for sharing derivatives: Tuhin Kanta Pandey, while digital infrastructure has brought the markets to fingertips, also has equipped fraudsters with new tools to mislead investors, Pandey complained. Unsolicited messages about Message apps, dubious finfluencers and fake trade platforms are all promising something that the markets can never deliver-Gegaranderderdement, he warned. “This is a challenging proposition for a nation where almost 80% of households are fundamentally risk -aging and prioritize capital retention. The Sebi chef said.

Sebi has carried out investor consciousness and educational programs, the most recent UPI -ID for SEBI registered intermediaries and complaint repair mechanism.

Read more: Sebi rolls out validated UPI handles to protect investors against cyber fraud

Pandey’s 4 major advice for investors:

1. Invest your time: Be well informed when making investment decisions, even in today’s fast investment environment.

2. Do not trust or blindly check: Check the registration status of each entity on the SEBI website.

3. Ask unrealistic promises: every promise of “guaranteed” return goes against the nature of our markets.

4. Do your own research: don’t be influenced by rumors. As Warren Buffett said, “Risk is due to not knowing what you are doing.”

(Disclaimer: recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of economic times)