Indore case exemplifies how RIA licence can be misused
Being deceptive One way to make money in the stock market is to be really good at understanding financial statements, macroeconomic factors, making financial models. You take some risk and make some money if things work out. An arguably better way to make money is to not invest your own money in the market and instead advise someone else to invest theirs, and charge them for the advice.
The only thing that matters here are good marketing skills. So, how exactly does an investment adviser be good at marketing? Fund managers can point to their past fund performance and wink while they put out the disclaimer that past performance isn’t indicative of future returns. But investment advisers don’t manage money, they just give out advice! Here’s what Vicky Kamariya, who ran Money Market Manthan, put on the firm’s website, as per an extract from the Sebi order.
“Equity Cash Intraday: You are definitely going to make profits if you make investments on the basis of stock cash tips given by our team who solely work for researching the news and stocks. You can subscribe our services at reasonable package and then get up to intraday basis calls every day, weekly and monthly reports, chat sessions and dedicated customer service support for becoming a successful trader and make big profits with small investments on regular basis". The statement, ‘You are definitely going to make big profits with small investments," has a nice ring to it.
Unfortunately, Sebi is not convinced by promises of any sort of fixed returns when it comes to the equity markets. This one was out-and-out illegal! Now, for a quick question. When you sign up for something with your email address and get a welcome email—how often do you read the contents of that
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