Descriptive Prep: Brajesh Mohan

SEBI flags newspaper ad on dabba trading in Navbharatimes Newspaper Market regulator SEBI on Monday took serious note of an advertisement, published in a Hindi daily, promoting dabba trading activities. Dabba trading violates provisions of the Securities Contracts (Regulation) Act, 1956, SEBI Act, 1992, and Bhartiya Nyay Sanhita, 2023, and pose significant risks to investors, the regulator said in a statement. What is Dabba trading? Dabba trading is an illegal mode of trading in securities where trades are not executed on official stock exchange platforms but are settled internally by dabba operators. Since such trades are not executed on official stock exchange platforms, investors can not avail the grievance redressal mechanism of stock exchanges. In dabba trading, brokers serve as intermediaries between traders. They find buyers and sellers interested in the same security within the dabba market, connecting them and facilitating the trade for a commission, which is a percentage of the trade value.

Possible Reason for this: - Herd Mentality: Many investors follow what others are doing without understanding the product. - “Bigger is safer” perception often leads investors to pour money into already large schemes. - Cross selling of MFs by Banks (HDFC, SBI, ICICI, Kotak) for their own fund. - Investors tend to allocate to schemes that have shown strong past returns — even if they may not sustain them. Parag Parikh Flexi Cap and HDFC BAF have been popular due to strong historical performance. - Regular SIPs (Systematic Investment Plans) accumulate and snowball over time. SIP book in these funds has remained robust even during market volatility. - Most retail investors don’t consult SEBI-registered investment advisors. Without proper asset allocation strategy, they go for “popular” or “top-rated” funds.

What is QIP? QIP allows listed companies to raise capital by issuing equity shares, fully or partly convertible debentures, or other eligible securities to Qualified Institutional Buyers (QIBs) without the need for extensive regulatory approvals required in public offerings such as IPO or FPO. QIPs are offered exclusively to QIBs, ensuring faster placement as these investors have the financial capacity and expertise to evaluate the investment. It is governed by the Securities and Exchange Board of India (SEBI) under the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018.

Note: QIP as well as Bonds, Basel-III etc are all in our Finance Syllabus. Last year RBI asked 10 Marker on AT-1 Bonds and most student were not ready with the answer.

The Securities and Exchange Board of India (SEBI) has released a Draft Circular on Categorization and Rationalization of Mutual Fund Schemes for public consultation, aiming to enhance transparency, investor understanding, and ensure distinct portfolio structures across the ₹55-lakh crore mutual fund industry. To prevent overcrowding in scheme categories, new schemes can be launched only if: — The existing scheme is over 5 years old — AUM exceeds ₹50,000 crore — Subscription to the old scheme halts post-launch of the new one Each new scheme must use similar nomenclature (e.g., Large Cap Scheme – Series II) and adhere to identical investment mandates.

The Securities and Exchange Board of India (SEBI) has barred one of the world's largest quant trading firms, Jane Street, from accessing its securities market after an investigation found it made "unlawful gains", taking the most stringent action ever against a foreign trading firm. The markets regulator also impounded ₹4,841 crore from U.S.-based Jane Street, which said it disputed the findings. What is Jane Street? Jane Street has more than 3,000 staff in five offices across the United States, Europe, and Asia. It trades in stocks of 45 countries and is also rapidly increasing its presence in Hong Kong by purchasing more office space. Jane Street was established in 2000 and its annual revenues last year were $20.5 billion. What's Allegations? SEBI says Jane Street as a group first aggressively bought significant quantities of banking stocks and futures, temporarily pushing up Bank Nifty, the banking index. It simultaneously built large short positions in index options. Later, it aggressively sold large quantities of the same banking stocks and futures to profit from their options positions. This large scale buying influenced retail investors to invest, leading to market manipulation, SEBI said. SEBI also said that by incorporating entities in India, Jane Street managed to "work around" regulations that prohibit foreign portfolio investors from undertaking intraday positions in the cash market.

The Securities and Exchange Board of India (SEBI) on Friday, February 14, launched a dedicated Related Party Transaction (RPT) portal to enhance transparency and governance in corporate India. This portal aims to bring greater transparency to corporate boardrooms, SEBI Whole Time Member Ashwani Bhatia said at its unveiling in Mumbai. SEBI introduced this portal as a strategic move to track and analyse RPTs, a critical area where governance lapses often occur.

SEBI's New Asset Class.

The new CPI series will revise the base year from 2011-12 to 2023-24. Under this new series, the weight of food and beverages is expected to reduce from the current 45.86% to 36.75%. 2023-24 HCES Survey in India provided comprehensive data on spending, strongly validating Engel’s Law, which states that as income rises, the proportion of income spent on food declines. The new revision, the government and economists have noted, will reduce volatility in consumer inflation. Article link 🔗 https://indianexpress.com/article/business/new-inflation-series-weight-of-food-items-drop-37-cpi-46-10502164/

In SEBI Grade A 2024 Paper II - There would be 100 Questions for 100 Marks in 90 Min. I am listing most Important Topics based on PYQs from 4 Key Subjects. Commerce and Accounts (2022 - 9 Q and 2024 - 16 Q) Income Statement, Balance Sheet Ratio Analysis Accounting for Bonus Shares and Rights issue Accounting for Share Capital Accounting for Buyback of Shares Accounting Standard for Investments Accounting standard for Inventories Financial Statement Analysis and Fund Flow System Preparation and Presentation of Company Final Accounts Costing (2022 - 9 Q and 2024 - 13 Q) Lean System and Innovation Standard Costing and Variance Costing Marginal Costing Activity Based Costing Job and Batch Costing Company Law Chapter III – Prospectus & Allotment of Securities Chapter IV Share Capital and Debenture Chapter VIII Declaration and payment of Dividend Chapter X Audit and Auditors Chapter XI – Appointment of Directors Chapter XII-Meeting of Board of Directors Chapter XXVII – NCLT and NCLAT Economics Market Structures Demand and Supply, Elasticity of demand IS-LM Model Inflation and Philips curve Monetary and Fiscal Policy Balance of Payments There is Finance and Management (In it you can expect case study based Questions) too.

In SEBI Grade A Descriptive English, there are Essay for 30 Marks, Precis for 30 Marks and RC for 40 Marks and All need to be done in 60 Min. In 2024, Essay was asked for 250 -270 words. So, Ideally you need to devote 20 min on Essay, 15 Min on Precis and 25 min on RC Out of Total 60 Min. What is Drafting Skill Mean? Drafting skill generally mean your ability to write clear, structured, and purpose-driven content in formal English, as expected from an officer in a regulatory institution. — Clarity of thought: Can you express ideas logically and unambiguously? Is your message easy to understand for the reader? — Articulation: Proper Paragraphing, flow, and coherence + Staying relevant to the topic — Language accuracy: Grammar, sentence construction, punctuation Basically Writing exactly what is required without getting into too much depth and also without making too many errors.