Thursday, September 4, 2014

SEBI Regulations - Discontinuance of Detailed Stock Specific Analysis

SEBI has notified certain guidelines on 1st Sept 2014 called as : SECURITIES AND EXCHANGE BOARD OF INDIA (RESEARCH ANALYSTS) REGULATIONS, 2014. These regulations will go into effect 90 days from their publication in the official gazette.

The new regulations are a step in the right direction, seeking to safeguard investors from manipulative research reports.

While the author of this blog is just a passionate investor & not a research analyst, it does however appear that the scope of the new regulations covers blogs such as this one. 

Over the last couple of years this author has generally refrained from giving explicit calls, rather, he has presented the facts, explained why the stock idea merits attention, and requested that the reader should research the stock further & take an appropriate call based on his/her own conviction in the stock idea. He has also unfailingly disclosed his interest in the stock, in the Disclosure/Disclaimer section.

As the author is simply an enthusiastic & passionate investor, and has no pretensions/aspirations of being a qualified research analyst, he is not of the mind (at the moment at least) to accredit himself as a research analyst.

Hence, in keeping with the spirit & letter of the new regulations, the author will refrain from any detailed stock specific analysis in future.

This will be the case at least until it is clarified - if at all - either that 

  • Blogs such as this one are not within the scope of the new regulations, or
  • Simply covering an idea - with an explanation on why the idea merits investor attention but refraining from making any explicit recommendation - is not within the scope of the new regulations

Thanks to those of you who have written in with some kind words from time to time, and wishing all of you a fruitful investing career.