Investor awareness key to long-term wealth creation, technology double-edged sword: ANMI President Kamlesh Shroff

Continuous investor awareness and early market participation remain the primary drivers for long-term wealth creation, even as the cost of transacting in India remains among the highest globally due to taxes like STT, said Kamlesh Shroff, National President, Association of NSE Members of India (ANMI).

Speaking with on the sidelines of the ANMI Seminar on Investor Awareness & Financial Education in Mumbai on Tuesday, Shroff highlighted the shifting demographic profile of market participants.

"The new kids who are actually investing-the average age has consistently reduced and now stands at 28 to 29 years. Getting into the market faster provides a better opportunity to make money through compounding and long-term appreciation," Shroff said.

Addressing concerns over market volatility and high-frequency algorithms disadvantaging retail traders, Shroff emphasized that education is critical. "Investors need to understand that they face a structural disadvantage against algos or HFTs. Once aware, they will realise that buying options like lottery tickets is not the way forward," he noted.

On the rise of digital financial scams and tech-driven frauds, Shroff cautioned investors to rely only on SEBI-registered entities and verified platforms, citing SEBI's nationwide 'Project Jago' awareness campaign as a pivotal step to educate investors at every nook and corner.

"Technology has scaled up, bringing both benefits and risks. We don't need to step back from technology, but scale up with basic safeguards. Education and information are the right way forward," he added, assuring that platforms like SEBI and registered broker apps offer ample self-learning resources for investors without formal financial backgrounds.

Commenting on the broader broking industry, Shroff noted that high technology costs-accounting for over 40-50% of an outfit's budget-are driving a wave of consolidation among smaller non-institutional brokers.

On market valuations, he remarked that large-cap indices trading around 19-20 P/E remain reasonably valued, while mid and small caps require careful evaluation of underlying growth results.

Addressing the audience during the seminar, Amit Pradhan, Executive Director, SEBI, highlighted the alarming pervasiveness of digital financial scams. He stated that digital and securities market frauds have led to massive losses exceeding Rs 22,500 crore overall, with Rs 17,500 crore lost in security markets alone due to fake apps, unregulated products, and unverified investment channels.

Pradhan warned against the risks of unregulated assets like cryptocurrencies and unverified influencer advice, urging young investors to prioritize capital protection and utilize simple regulated avenues like Demat accounts and SIPs.

Also addressing the audience during the seminar, Deepti Aggarwal, Chief General Manager, SEBI, introduced the core objectives of SEBI's 'Samajh Se Investing Simple' campaign under Project Jago. She emphasized bridging the gap between high awareness and actual participation by delivering simple financial content in regional languages.

Aggarwal urged investors to adopt the 'CVR' framework-Check, Verify, and Validate-to ensure entities are SEBI-registered before transferring funds, using tools like the SEBI Saathi app and the SEBI Check feature.
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