DOS
Deal only through SEBI registered intermediaries.
Complete all the required formalities of opening an account properly
(Client registration, Client agreement forms etc).
Ask for and sign “Know Your Client Agreement”.
Read and properly understand the risks associated with investing in
securities / derivatives before undertaking transactions.
Assess the risk – return profile of the investment as well as the liquidity
and safety aspects before making your investment decision.
Ask all relevant questions and clear your doubts with your broker
before transacting.
Invest based on sound reasoning after taking into account all publicly
available information and on fundamentals.
Give clear and unambiguous instructions to your broker / sub-broker /
depository participant.
Be vigilant in your transactions.
Insist on a contract note for your transaction.
Verify all details in contract note, immediately on receipt.
Crosscheck details of your trade with details as available on the
exchange website.
Scrutinize minutely both the transaction and the holding statements
that you receive from your Depository participant.
Keep copies of all your investment documentation.
Handle Delivery Instruction Slips (DIS) Book issued by DP’s carefully.
Insist that the DIS numbers are pre-printed and your account number
(client id) be pre stamped.
Incase you are not transacting frequently make use of the freezing
facilities provided for your demat account.
Pay the margins required to be paid in the time prescribed.
Deliver the shares in case of sale or pay the money in case of
purchase within the time prescribed.
Participate and vote in general meetings either personally or through
proxy.
Be aware of your rights and responsibilities.
Incase of complaints approach the right authorities for redressal in a
timely manner.
In case physical deliveries are received, check them as per the
Good/Bad delivery guidelines issued by SEBI.
Transfer of ownership of physical shares should be executed by a
valid, duly completed and stamped transfer deed
Educate other investors (Friends, Family etc.) about these Dos &
Don’ts
DON’TS
Given the benefits of trading on stock exchange it is advisable to avoid
off-market transactions.
Don’t deal with unregistered intermediaries.
Don’t fall prey to promises of unrealistic returns.
Don’t invest on the basis of hearsay and rumors; verify before
investment.
Don’t forget to take note of risks involved in the investment.
Don’t be misled by rumours circulating in the market.
Don’t be influenced into buying into fundamentally unsound companies
(penny stocks) based on sudden spurts in trading volumes or prices or
non authentic favorable looking articles / stories.
Don’t follow the herd or play on momentum - it could turn against you.
Don’t be misled by so called hot tips.
Don’t try to time the market.
Don’t hesitate to approach the proper authorities for redressal of your
doubts / grievances.
Don’t leave signed blank Delivery Instruction Slips of your demat
account lying around carelessly or with anyone.
Do not sign blank Delivery Instruction Slips(DIS) and keep them with
Depository Participant(DP) or broker to save time. Remember your
carelessness can be your peril.
Do not follow investment advice from news channel experts – do your
own research.
Do not invest under peer pressure.
(Source : www.investor.sebi.gov.in)
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