SEBI warns investors against real-time trading tips on social media

SEBI said it has come to its notice that certain individuals on social media platforms are offering real-time tips on taking positions in the stock market through live trading sessions.

“These persons portray themselves as experts in the securities market, provide detailed analysis of when to invest, when to exit, strategies to be followed and the positions to be taken on market indices,” the regulator said in a press release.

According to SEBI, some of these individuals claim to trade in real time while showcasing their trade performance, market patterns based on live data and the targets they expect to be achieved.

The regulator also noted that such live trading sessions are being watched by a substantial number of viewers, with live chats enabled alongside the sessions where unregistered advisory services are allegedly being exchanged.

SEBI, in a circular issued on May 8, said market price data may be shared for investor education and awareness activities only with a 30-day lag and without offering any monetary incentive to participants.

“A person engaged solely in education should not be using market price data of the preceding thirty days of any security or indicate the future price or provide advice or recommendation related to security or securities,” SEBI said.

The regulator further clarified that live market data cannot be shared by any entity except for purposes related to the orderly functioning of the securities market or for fulfilling regulatory requirements.

Against this backdrop, SEBI advised investors not to trust claims made by persons offering live or real-time trading strategies on social media and not to base their investment decisions on such sessions.

“Investors are advised to not trust claims of such persons and not to take their investment decisions on such live trading sessions and to deal with only SEBI registered intermediaries,” the regulator said.