Your Ticket to Safe Investing

Irshad Mushtaq

Investing in the stock market is an essential part of financial planning for many individuals. However, it is important to ensure that this investment is made through a SEBI registered stock broker. The Securities and Exchange Board of India (SEBI) is the regulatory body for the securities market in India, and it is crucial to invest in stocks through brokers that are registered with SEBI.

Opening an account with a SEBI registered stock broker involves the process of CKYC, which stands for Central Know Your Customer. This initiative by the Indian government requires individuals to provide their identity and address proof, as well as other necessary documents, in order to open an account with a stock broker. This ensures that the investment is made by legitimate individuals and helps in preventing fraud and other illegal activities.

When investing through a SEBI registered stock broker, individuals are provided with a platform to connect with stock exchanges such as the NSE and BSE. All trades are conducted through the broker’s office, mobile application, or website, and are instantly confirmed by the broker as well as the exchange. This ensures that the trade is conducted in a legal and transparent manner.

Additionally, the shares purchased through a SEBI registered stock broker are held in NSDL or CDSL, which are the depository participants for shares. This means that the shares are not held by the broker, but rather by governmentcontrolled entities, providing a layer of security for investors. In the unlikely event of a broker defaulting, the shares remain safe with the depository participants.

Furthermore, SEBI guidelines require that investors receive trade confirmations and other important information directly from the exchange, NSDL, and CDSL. This ensures that investors are kept informed about their investments and any activities related to their accounts.

Overall, investing through a SEBI registered stock broker provides a secure and transparent platform for individuals to invest in the stock market. With the implementation of initiatives like CKYC, and the involvement of governmentcontrolled entities such as NSDL and CDSL, investors can have confidence that their investments are safe and legally conducted. Therefore, it is essential to invest through SEBI registered stock brokers for a secure and legitimate investment experience.

— Author is NISM qualified, Mutual Fund advisor and distributor having experience of 18 years in financial market