SEBI Proposes 30-Day Price Data Lag for Educational Use

SEBI has put forward a uniform time of 30 days as the maximum allowable time for both the sharing and usage of market price data for educational/investor awareness purposes. The consultation paper (published 6th January) is aimed at creating consistency of rules and ensuring that there is no misuse by market educators. 

The public can provide feedback until 27th January. The proposal seeks to balance both protecting the data and making available effective educational resources.

The current guidelines are leading to confusion between institutions/organisations. 

Addressing the Grey Zone

Some educators or influencers may be utilising near-real-time data, which blurs the lines with providing unregistered investment advice. The results of Sebi's investigations indicate that "fin-fluencers" are raising funds through paid courses, while touting them as pure educational material. 

Utilising real-time data to perform analysis to predict prices is outside the constructive realm of teaching. Online platforms and apps also run the risk of crossing over into regulated "research" based activities. 

The goal of the regulator is to resolve this grey area.

Resolving Conflicting Rules

Through its May 24 circular, stock exchanges are barred from sharing live data with third-party entities (this will remain true for July and August). Thus, educators will have access to only one day of lag in live data.

A lower-tiered January 29 circular allows educators the ability to utilise only 3-month-old data.

Having these two circulars/rules in conjunction creates an opportunity for interpretation issues. Stakeholders indicate that providing only 3-month-old data makes content less appealing and less relevant.

This proposal provides a bridge between the two proposed circulars/rules in an attempt to create consistency through a 30-day period.

Broader Investor Protection Push

Through its broader Investor Protection efforts, all other components of the education framework established through the January prohibition continue to remain in effect.

By requesting input, SEBI seeks to add additional protections against data abuse. This is in alignment with SEBI's efforts to curtail the activities of Finfluencers who blend educational content with advice.