SEBI Warns Investors: Avoid These Platforms to Protect Your Investments

Mohan is a 32-year-old IT professional. Recently, he downloaded a new trading app that promised quick profits. He also watched some convincing YouTube videos, so he invested ₹48,000.

After two weeks, he checked his account, showing a zero balance. When he thought of filing a complaint, the app vanished. There was no contact number and no refund. 

He later discovered that the app was not even connected to the real stock market. Unfortunately, thousands of innocents, like Mohan, fall into similar monthly traps.

According to the reports, over 5 crore people use such opinion trading platforms, accounting for a yearly trading volume of over ₹50,000 crore.

Although financial regulations do not recognise such platforms, they attract many users daily.

What Are Opinion Trading Platforms?

There are a lot of websites and mobile apps available where you can place bets about what will happen to the price of a stock in the next few minutes. Such websites and mobile apps are opinion trading platforms.

You might see questions such as:

• “Guess if the index will rise or fall at 2 PM.”
• “Will ABC stock go up in 5 minutes?”

Using such apps, you would not invest in real stocks. Instead, they turn the stock market into a guessing game.

Why SEBI Has Issued A Warning?

The regulator has recently seen the rapid rise of these platforms and is concerned about public interest. You must know these apps are not part of the official trading system.

Read More - SEBI Warns Investors
 

The main reasons for the warning include the following:

• You might have also seen many influencers promoting these apps without disclaimers.
• There is a risk of data misuse.
• Some of these apps disguise betting as financial knowledge.
• If you lose money on such apps, there is no complaint route.

• Such apps are not registered as brokers or advisors.

   

The Scale Of The Problem

If we take a look at the numbers, then we will see how big this is becoming:

Even if 2% of users become victims of this fraud, that’s still 10 lakh individuals. And if each of them loses ₹10,000, that is a loss of ₹1,000 crore.

How Do These Platforms Trap You?

These platforms mostly lure you with high rewards and aggressive marketing tactics. The following are the general practices they use:

1. Endorsements by Influencers

Promotional videos from social media stars and influencers claim huge earnings.

2. Referral Income

Unknowingly, you become their marketer by luring them with offers like earning ₹100 to ₹500 for every friend you bring in.

3. Quick Payouts

Fast results make you feel like playing a game. Want to get ₹195 on a bet of ₹125? Who would not try this?

Also Read -  How to Avoid Investment Scams 
 

4. Use of Real Terms

They use terms such as ‘market’, ‘nifty’, or ‘option’ to make it sound real.