CBSE 2025, BS Set 1

Question

State any three 'Protective functions' of the Securities and Exchange Board of India.

Edvaya · Accepted Answer

The correct answer is Subjective. **Three Protective Functions of SEBI:**

**(i) Prohibition of Insider Trading:** SEBI prohibits company insiders (directors, promoters, employees) from trading in securities using price-sensitive information not available to the public. This protects ordinary investors from being exploited.

**(ii) Prohibition of Fraudulent and Unfair Trade Practices:** SEBI prohibits activities like price rigging, misleading statements, and manipulation of security prices. This ensures a fair and transparent market for all investors.

**(iii) Investor Education:** SEBI educates investors about their rights and the risks associated with investing in securities. It conducts investor awareness programmes to help investors make informed decisions and protect themselves from fraud.

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Business Studies > Business Finance > Financial Markets

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