NSE warns against market-induced investments

18 December 2007

Mumbai: A day after the National Stock Exchange put a freeze on derivative contracts in 13 securities whose market-wide position limit had crossed 95 per cent, the country's leading bourse has asked investors to keep away from rumours and advertisements promising large returns.

NSE, which saw its benchmark Nifty index recorded the biggest single-day loss on Monday, asked investors to tread carefully before investing in equities.

NSE has asked investors to "do a thorough evaluation before trading in any security".

"Do not be attracted to stocks promoted by internet websites, research reports, tips etc unless you have done adequate study of the company," NSE said in an advertisement published in leading newspapers today.

NSE has asked investors to check information like price-volume data, financials and shareholding patterns before investing. The exchange also asked them to be cautious of stocks that show a sudden spurt in price or trading activity without a change in its fundamentals.