INSIDER TRADING LAWS IN INDIA: STRIKING A BALANCE BETWEEN MARKET EFFICIENCY AND INVESTOR PROTECTION

AUTHOR – YASHIKA NAYAK, ADVOCATE AT HIGH COURT OF GWALIOR MADHYA PRADESH

BEST CITATION – YASHIKA NAYAK, INSIDER TRADING LAWS IN INDIA: STRIKING A BALANCE BETWEEN MARKET EFFICIENCY AND INVESTOR PROTECTION, INDIAN JOURNAL OF LEGAL REVIEW (IJLR), 4 (3) OF 2024, PG. 154-163, APIS – 3920 – 0001 & ISSN – 2583-2344.

ABSTRACT

This research paper explore, how insider trading laws in India balancing the market efficiency and Investor protection includes rights of investor, evolution, enforcement and market dynamics. It starts dealing by the legal framework established by the Securities and Exchange Board of India (SEBI) and relevant laws. The paper discussed the challenges of enforcing these laws, such as detecting insider trading and the penalties for those who break the rules. By evaluating case studies and empirical data, the study highlights the tension between fostering a competitive market environment and protecting investors from unfair practices. Furthermore, the study discusses the implications of insider trading on market dynamics, exploring how such practices can distort price discovery and harm the overall investment climate. It emphasizes the need for a more proactive approach, including greater transparency, enhanced regulatory cooperation, and the integration of advanced data analytics to detect suspicious trading patterns.

Keywords: – Insider Trading, Market Efficiency, Investor Protection, SEBI, Legal Regulations, Financial Market.