Market watchdog, Securities and Exchange Board of India (SEBI) will soon launch a nationwide campaign to educate investors to make the market more disciplined and transparent, SEBI chairman M Damodaran said in Agartala on Sunday.
"Investors, before making investments, should know how much risk is involved, what would be the return and benefits, and the legal procedure of their investment," said Damodaran, who is on a four-day visit to Tripura.
The education campaign for investors would be launched from the year-end, he said.
The official noted that there should be more registered investors associations, who can take up the task of sensitising probable investors, as SEBI alone won't be able to provide proper education to the huge number of investors across India.
Till last year there were eight registered investors associations in the country and now it has increased to 28, he said.
Damodaran, who was former Tripura chief secretary, claimed that India's stock markets were more disciplined, organised and enabled speedy transaction compared to other developed countries.
He asserted that there was "no evidence with the SEBI that militant outfits or bad elements are investing money in the market".
But Damodaran added, "SEBI has no role if an extremist outfit or any unauthorised person or group invests money in market. It is up to the bank to check such illegal investments and probe from where the money comes.
"Banks are now more active about investment as they follow the Reserve Bank of India (RBI) guidelines of 'Know Your Customers' and other norms."
Supporting Prime Minister Manmohan Singh's opinion that private firms should reduce the high salaries of their executives, the SEBI chief said, "Shareholders of these companies should be more active and serious in this regards."
While Damodaran said that SEBI was extra vigilant when a new company started its business or invested money in the market, he admitted that the body had not been completely successful in protecting all investors.