This is why never trust finfluencers blindly!

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Trading on the stock market has become quite easy nowadays. There are several so-called experts who give trading tips to investors. On social media, you will see hundreds of such finfluencers and their millions of followers. These finfluencers claim that they would help you earn lakhs-crores of rupees in shares and derivatives. They lure people by showing fake screenshots that they have earned lakhs in shares and derivatives. They show their luxury lifestyle. They cheat people by either giving online or offline courses or selling passes to their premium telegram channels…

While such courses and telegram channels may increase people’s financial literacy a bit, blindly trusting the advice of finfluencers can prove to be costly. There have been many reports where an influencer from a telegram channel claiming to make hefty earnings was sitting on a big loss. You will find thousands of videos where claims of handsome profits are being made, but do you think these people will also make videos about their losses? Advice is being given to buy and sell shares without any analysis. And trading apps also contribute significantly to the growing business of these finfluencers. These apps are giving a good commission to promote their affiliate links.

The market regulator SEBI has made a law that if someone is not a research analyst, he cannot give tips about any stock. It has started taking action against such unregistered entities that give advice related to buying and selling of shares. But after SEBI’s action, finfluencers have started playing with words. For example, they have started using words like ‘support’ and ‘resistance’ instead of ‘buy’ and ‘sell’. This means, they are giving advice indirectly by changing words. Recently, SEBI also presented a consultation paper in which a proposal has been made to impose restrictions on finfluencers from establishing connections with registered intermediaries or regulated entities. SEBI aims to put a stop to the exaggerated claims of earnings made by these finfluencers. Sebi aims to stop finfluencers from inflating price of any stock. Stakeholders have been asked to respond to the proposal by September 15.

Finfluencers claim that they will clear your concept in two to three days but understanding the market in two-three days does not seem logical. Yes, it is necessary that you read for clearing your concept on the market. Big experts increase their knowledge by reading books. So if you want good knowledge about investment and trading then you will also have to read for it. If you are new and want to enter the market then it is not necessary that you follow a finfluencer. The content on YouTube can be quite technical, so you will also have trouble understanding it. You can watch YouTube channels of Sebi registered entities.