Stay alert, stay away from frauds! Here's what NSE wants investors to follow
Even your stock investments can be in danger, if not taken precautions in time.
Fraudsters' attacks are not limited just to your mobile phones or bank accounts. The reach of the scamsters is very vast. They even cover the markets. In the past, you would definitely have been made aware of various mistakes that must never be made, including not sharing financial credentials of any form on suspicious portals or call centres as they have the potential of robbing you of your money. But do you know that even your stock investments can be in danger, if not taken precautions in time.
NSE has released a number of precautions and safety measures for investors to make smart choices. NSE suggests investors to not get carried away during stock investment. Also, beware of assured or fixed return schemes.
According to NSE, a smart investor must always be aware when someone is offering them assured or fixed return investment schemes on exchanges.
By assured return schemes, it means you have been guaranteed with a specific percentage of return on your equity investments for a certain time. The truth is that the equity market is highly volatile, and changes every second. There are no fixed returns in the market, only long term and short capital gains or losses. For instance, if you gained 18% return in your portfolio last year, there is no guarantee you will gain the exact same amount of profit even this year.
Hence, when someone offers fixed return or assured schemes, it is a point of caution and one must always study what is being offered aforesaid.
As per NSE, never trust written and oral promises of assured return in equity and derivatives markets. Have full knowledge about the product you invest in.
There are chances that these assured return schemes might not even have market regulation, making you critical to frauds. Do not invest in any schemes run by an entity not having SEBI registration, says NSE. Additionally, never make payment in cash to astockbroker.
Here's a list of smart practices you can follow to become smart investor, as per NSE.
Firstly, always ensure that you fill your KYC form with correct details and strike off all the blank fields. Secondly, make sure you register your mobile number and email address with the stockbroker to receive trade confirmation alerts directly from NSE.
Further, ensure that contract notes are received from the broker whenever you trade. Also, do not share your internet trading account's password with anyone. Because revealing your password to anyone is clearly an open invitation for misuse. There are chances that trades can be made on your behalf without even your knowledge. Also, change your password periodically, especially when you access your account from cyber cafes or public computers.
Finally, get a clear idea about brokerage and other charges levied by the broker. NSE also points out that there can be chances that instead of receiving money, you might end up owing to the broker. Therefore, invest after making important checks about your broker.