Advertisements
Advertisements
प्रश्न
State the protective functions of the Securities and Exchange Board of India.
State any three protective functions of the Securities and Exchange Board of India.
Advertisements
उत्तर
The following are the protective functions of SEBI:
- Prohibition: SEBI prohibits fraudulent and unfair trade practices. In addition, it prevents the spreading of misleading statements, which are likely to affect the functioning of the securities market.
- Checks on insider trading: Insider trading refers to a situation wherein an individual connected with the company leaks out crucial information regarding the company, which may adversely affect its share prices. SEBI keeps a strict check on such practices.
- Promotion: SEBI encourages fair trade practices and promotes a code of conduct for the intermediaries to assist fair trade.
- Protection: SEBI undertakes various steps and protective measures to protect the interests of the investors in the financial markets.
- Controlling: The controlling of insider trading and imposing penalties for such practices.
Notes
Students should refer to the answer according to their questions.
APPEARS IN
संबंधित प्रश्न
Mr. Sanjay Nehra was the Chairman of 'Taran Bank.' The bank was earning good profits. Shareholders were happy as the bank was paying regular dividends. The market price of their shares was also steadily rising. The bank was about to announce taking over of 'Vena Bank.' Mr. Sanjay Nehra knew that the share price of 'Taran Bank' would rise on this announcement. Being a part of the bank, he was not allowed to buy shares of the bank. He called one of his rich friends Sudhir and asked him to invest Rs 5 crores in shares of his bank promising him the capital gains. As expected the share prices went up by 40% and the market price of Suhir's shares was now Rs 7 crores. He earned a profit of Rs 2 crores. He gave Rs 1 crore to Mr. Sanjay Nehra and kept Rs 1 crore with himself. On regular inspection and by conducting enquiries of the brokers involved, Securities and Exchange Board of India (SEBI) was able to detect this irregularity. The SEBI imposed a heavy penalty on Mr. Sanjay Nehra.
By quoting the lines from the above para identify and state any two functions that were performed by SEBI in the above case.
Mr. Aditya Gupta was the chairman of ‘Vandan Bank’. The Bank was earning good profits. Shareholders were happy as the bank was paying regular dividends. The market price of their shares was also steadily rising. The bank announced taking over of ‘Karur Bank’. Aditya Gupta knew that the share price of Vandan Bank would rise on this announcement. Being a part of the bank, he was not allowed to buy shares of the bank. He called one of his rich friends Nimesh and asked him to invest Rs 6 crores in the shares of his bank promising him the capital gain.
As expected, the share prices went up by 40% and the market price of Nimesh’s shares was now Rs 8.4 crores. He had earned a profit of Rs 2.4 crores. He gave Rs 1.2 crore to Mr. Aditya Gupta and kept Rs 1.2 crore with him. On regular inspection and by conducting enquiries of the brokers involved, Securities and Exchange Board of India (SEBI) was able to detect this irregularity. SEBI imposed a heavy penalty on Aditya Gupta. By quoting the lines from the above para identify and state any two functions that were performed by SEBI in the above case.
India’s largest domestic investor Life Insurance Corporation of India has once again come to government’s rescue by subscribing 70% of Hindustan Aeronautics Rs.4,200-crore initial public offering.
a. Which market is being reflected in the above case?
b. State which method of floatation in the above identified market is being highlighted in the case? (Primary Market)
c. Explain any two other methods of floatation. (Private Placement, Offer through prospectus, offer for sale).
Lalita wants to buy shares of Akbar Enterprises, through her broker Kushvinder. She has a Demat Account and a bank account for cash transactions in the securities market. Discuss the subsequent steps involved in the screen-based trading for buying and selling of securities in this case.
Answer each of these questions in about fifteen words
What do you understand by private placement?
Answer each of these questions in about fifteen words:
State three functions of SEBI rolled into one body.
Answer each of these questions in about fifty words:
Explain briefly the three functions of SEBI rolled into one body.
Answer each of these questions in about one hundred and fifty words:
Explain the powers SEBI has been vested with for discharging of its functions efficiently.
What is the power of SEBI?
State any three Development functions of Securities and Exchange Board of India.
Write a word or a term or a phase which can substitute for the following:
Regulator of securities market in India.
State whether the statement is true or false:
SEBI protects the interest of investors in securities market.
Attempt the following:
Write a reply to a complaint by an investor
State any five regulatory functions of the Securities and Exchange Board of India.
What are the objectives of the SEBI?
Which of the following is the regulatory function of SEBI?
What are the protective function of SEBI?
Under which method, the securities are sold only to some selected individuals and big institutional investors rather than to the public.
Which of the following can be a depository participant (DP)?
______ is an institution or organisation, which holds securities in electronic form, in which trading is done.
______ is a legally enforceable document and helps to settle disputes/claims between the investor and the broker. It contains details of the number of shares bought or sold, the price, the date and time of deal, and the brokerage charges.
Which of the following stands for SEBI?
The basic purpose of SEBI is to create an environment to facilitate efficient mobilisation and allocation of resources through the securities markets. Who are the constituents of this market for whom SEBI aims at creating a conducive environment?
State the first development bank of the country
Assertion (A): Certificates of Deposit (CD) are secured, negotiable, long-term instruments in bearer form.
Reason (R): A rise in call money rates makes other sources of finance such as commercial paper and certificates of deposit cheaper in comparison as banks raise funds from these sources.
______ debt-equity ratio is preferred by the commercial banker over the years as it indicates financial strength of a unit.
Read the following text and answer the following question on the basis of the same:
Mr. A. Bose is running a successful business. Mr. Bose is the owner of R. K. Cement Ltd. Mr. Bose decided to expand his business by acquiring a Steel Factory. This required an investment of~ 60 crores. To seek advice in this matter, he called his financial advisor Mr. T. Ghosh who advised him about the judicious mix of equity (40%) and Debt (60%). Employ more of cheaper debt may enhance the EPS. Mr. Ghosh also suggested him to take loan from a financial institution as the cost of raising funds from financial institutions is low. Though this will increase the financial risk but will also raise the return to equity shareholders. He also apprised him that issue of debt will not dilute the control of equity shareholders. At the same time, the interest on loan is a tax-deductible expense for computation of tax liability. After due deliberations with Mr. Ghosh, Mr. Bose decided to raise funds from a financial institution.
In the above case Mr. Ghosh suggested to raised more funds from debt. Higher debt-equity ratio results in:
Zakira Ltd. wants to invest in treasury bills issued by RBI. What will be the minimum amount to be invested in Treasury Bill?
Which of the following statements is incorrect?
State any three objectives of the Securities Exchange Board of India.
SEBI regulates the securities market in India.
SEBI regulates the prices of the securities listed in the market.
