2.5What is SEBI?
1What is it?
SEBI (Securities and Exchange Board of India) is the government body that regulates India’s stock market. It became a statutory authority under the SEBI Act, 1992.
2Why does it exist?
A market where anyone can cheat would be dangerous for ordinary investors. SEBI is the referee who makes and enforces the rules.
3Real-life example
Like a cricket umpire. Players (companies, brokers, investors) play the game, and the umpire makes sure everyone follows the rules and punishes those who don’t.
4Quick revision
- SEBI is India’s market regulator.
- Set up in 1988, statutory since 1992.
- Protects investors and keeps markets fair.
5Knowledge check
Q1. What does SEBI stand for?Show answer
Securities and Exchange Board of India.
Q2. Why is SEBI compared to an umpire?Show answer
It makes and enforces rules so the game is fair.
Q3. Under which Act did SEBI get legal powers?Show answer
The SEBI Act, 1992.