Which Organisation has established a fund known as Investor Protection fund?
Answer:Investor Education and Protection Fund (IEPF) has been established under Section 205C of the Companies Act, 1956 by way Companies (Amendment) Act, 1999 for promotion of investors’ awareness and protection of the interests of investors.
What is investment protection fund?
Investor Protection Fund is the fund set up by the Stock Exchanges to meet the legitimate investment claims of the clients of the defaulting members that are not of speculative nature. 1 lakh in case of major Stock Exchanges viz., BSE and NSE, and Rs. 50,000/- in case of other Stock Exchanges.
How do investor protection funds make money?
- You may claim refund of such money through the following steps:
- Step 1: Register yourself on IEPF website iepf.gov.in.
- Step 2: Fill the new web form IEPF-5 Online.
- Step 3: Attach scanned copy of requisite documents with form.
What is IPF corpus?
At present, NSE has an IPF corpus of Rs 550 crore, while BSE has about Rs 785 crore. IPF is used to repay clients in case of broker default. It is also used for promoting investor education and research.
What are the legislations for investors protection?
At present, the five main Acts governing the securities markets are: (a) The SEBI Act, 1992 (b) The Companies Act, 1956, which sets the code of conduct for the corporate sector in relation to issuance, allotment, and transfer of securities, and disclosures to be made in public issues.
What is the purpose of investor protection fund?
The Investors’ Protection Fund may provide compensation against a genuine and bonafide claim made by any client, who has either not received the securities bought from a trading member for which the payment has been made by such client to the trading member thereagainst or has not received the payment for the …
What are the features of investor protection fund?
The Investor Protection Fund Trust, based on the recommendations of the Member and Core Settlement Guarantee Fund Committee (formerly Defaulters’ Committee), compensates the investors to the extent of funds found insufficient in Defaulters’ account to meet the admitted value of claim, subject to a maximum limit of ₹ 25 …
What is the maximum amount of claim payable from IPF and when is the payment made?
The limit allows that the money to paid as a compensation for a single claim shall not be less than INR 1 lakh – for the case major Stock Exchanges like BSE and NSE – and it should not be less INR 50,000 in case of other Stock Exchanges.
What is the main purpose of investors protection?
The term investor protection defines the entity of efforts and activities to observe safeguard and enforce the rights and claims of a person in his role as an investor.
How do I protect my investors interests?
Securities and Exchange Board of India (SEBI) is responsible for regulations of the Mutual Funds and safeguard the interests of the investors. Investor protection measures by SEBI are in place to safeguard the investors from the malpractices in shares, the stock market, Mutual Fund, etc.
What is the maximum amount of claim payable from IPF to the investor?
₹ 25 lakhs
The Investor Protection Fund Trust, based on the recommendations of the Member and Core Settlement Guarantee Fund Committee (formerly Defaulters’ Committee), compensates the investors to the extent of funds found insufficient in Defaulters’ account to meet the admitted value of claim, subject to a maximum limit of ₹ 25 …
What agencies protect investors?
The Securities and Exchange Commission (SEC) is a U.S. government oversight agency responsible for regulating the securities markets and protecting investors.
Why do we need to protect investors?
The Securities and Exchange Board of India (SEBI) has been mandated to protect the interests of investors in securities and to promote the development and regulate the securities market so as to establish a dynamic and efficient Securities Market contributing to Indian Economy. Small investors/deposit holders etc.
What laws protect investors?
the Securities Act of 1933
Often referred to as the “truth in securities” law, the Securities Act of 1933 has two basic objectives: require that investors receive financial and other significant information concerning securities being offered for public sale; and. prohibit deceit, misrepresentations, and other fraud in the sale of securities.
What are the benefits of credit rating to an investor?
7 Benefits of Credit Rating Agencies to Investors
- Benefits to Investors are as follows:
- (1) Safeguards against bankruptcy:
- (2) Recognition of risk:
- (3) Credibility of issuer:
- (4) Easy understandability of investment proposal:
- (5) Saving of resources:
- (6) Independence of investment decisions:
- (7) Choice of investments:
How does the government protect investors?
We protect investors by vigorously enforcing the federal securities laws to hold wrongdoers accountable and deter future misconduct.
What is the importance of credit rating from an investor & borrower’s perspective?
Better Investment Decision: No bank or money lender companies would like to give money to a risky customer. With credit rating, they get an idea about the credit worthiness of an individual or company (who is borrowing the money) and the risk factor attached with them.
What are the disadvantages of credit rating?
8 Main Disadvantages of Credit Rating
- Disadvantages of Credit Rating are as follows:
- (1) Biased rating and misrepresentations:
- (2) Static study:
- (3) Concealment of material information:
- (4) Rating is no guarantee for soundness of company:
- (5) Human bias:
- (6) Reflection of temporary adverse conditions:
What are the benefits and limitations of credit rating?
A credit rating tells a lender or investor the probability of the subject being able to pay back a loan….Credit rating offers various types of benefits:
- Information Service.
- Systematic Risk Evaluation.
- Professional Competency.
- Easy to Understand.
- Low Cost.
- Efficient Portfolio Management.
- Index of Faith.
- Wider Investor Base.
