SEBI Registration

Advertisement Code for Investment Advisers (IA) and Research Analysts (RA)

Investment Advisers

The market regulator SEBI published an advertisement code for Research Analysts and Investment Advisers on April 5th 2023. All registered Investment Advisers (IAs) and Research Analysts (RAs) must abide by the advertisement code, according to that circular from the Securities and Exchange Board of India (SEBI). The purpose of the circular is to guarantee compliance with the advertisement code established by SEBI and to strengthen the behaviour of IAs and RAs while publishing any advertisements.

Advertisement code for IA and RA

IAs and RAs must adhere to a code of conduct that is set forth in the Securities and Exchange Board of India (Investment Advisers) Regulations, 2013[1], and the Securities and Exchange Board of India (Research Analysts) Regulations, 2014. It is mandated that IAs and RAs guarantee compliance with the advertisement code as set forth below when issuing any advertisement in order to strengthen their conduct further.

All materials released by or on behalf of IA/RA, including brochures, research studies, newspaper or television ads, mail, electronic messaging, social media platforms, etc., will be considered advertisements under the new rule.

Investment Advisers (IAs)

A person or a company that offers personal financial advice is known as an investment advisor (IA). In order to serve their customer’s best interests, RIAs have a fiduciary duty to provide financial guidance. RIAs are registered with the Securities and Exchange Board of India, which regulates the market.

RIAs create a financial strategy for their investors after considering their objectives, resources, and existing circumstances. Also, they bill clients for their services. The cost of the financial plan is often a flat rate and the ongoing fee for the services they do.

Research analysts (RAs)

A research analyst is a finance expert that collects, analyses, interprets, and creates research reports on securities, stocks, and other assets. These experts evaluate and analyse records pertaining to stocks, securities, and commodities using their understanding of the consumer market and their proficiency with economic principles. A research analyst primarily works in the financial sector and assists businesses in purchasing, selling, and holding investments and securities, though they are in demand across many industries.

Key aspects of the guidelines

Forms of communication

  • An advertisement is any written or verbal statement made by or on behalf of IA/RA that has the potential to influence an investor or prospective investor to make an investment.
  • The forms of communication to which the advertisement code shall apply shall include pamphlets, brochures, circulars, notices, research reports, or any other literature, information, document or material published or designed for use in any publication or displays (such as newspapers, magazines, signboards/hoardings at any location), in wired, or wireless communication or in any electronic mode (such as electronic mail, text messaging, message boards, social media platforms, telephone, radio or in any other form over the internet), in any publication or displays (such as television, tape recording, videotape recordings, pictures) or in any other manner whatsoever.

Information/disclosures in the advertisement

The advertisement must include the following information/disclosures: 

  1. The name of the IA/RA as it is registered with SEBI, its registered office address, its SEBI Registration Number, its logo, brand name, trade name, and, if applicable, the IA/RA’s Corporate Identification Number (CIN).
  1. Information that is accurate, true, and complete in clear and concise language.
  1. A standard warning which states, “Securities market investments are subject to market risks,” in legible typefaces with a minimum font size of 10. Before making an investment, thoroughly read all the relevant documentation. No words may be added to or subtracted from the standard warning.
  1. The standard warning in visual media-based advertisements and the accompanying voice-over reiteration must be audible in a clear and understandable way in audio-visual media-based advertisements. For instance, a visual and voice-over reiteration of a warning that contains 20 words and lasts at least 10 seconds may be deemed to be clear and understandable.
  1. Make sure that the standard warning is appropriately translated into the language of the advertisement whenever the advertisement is released in a language other than English.
  1. The website must contain all such details if the mode of advertisement is SMS/Pop-up/Message, social media, etc., and the information such as name, full registered office, logo/brand name, SEBI registration number, membership number of a SEBI recognised authority, and standard disclaimer are not mentioned, then the official website hyperlinks should be provided in SMS/Message/Pop-up, etc.,
  1. A disclaimer stating that “The securities referenced are for example only and are not recommendatory” should be included if any specific security or securities are shown in the advertisement as examples.
  1. The disclaimer “Registration granted by Securities and Exchange Board of India, membership of BASL (in case of investment advisers), and certification from NISM in no way guarantee performance of the intermediary or provide any promise of returns to investors” must appear in all advertisements and communications/correspondence with clients.

Prohibitions regarding the advertisement

The advertisement shall not include the following: 

  1. Anything that is illegal to publish.
  1. Claims that are based on assumptions or projections but are inaccurate, misleading, biased, or deceptive.
  1. Testimonials that are false or deceptive in any way.
  1. Statements that could deceive investors directly, indirectly, or by omission.
  1. Any statement that could be misinterpreted or that could disguise the meaning of that statement or any other statement in the advertisement.
  1. Any claim intended to take advantage of the investors’ ignorance or lack of experience.
  1. Any exaggerated, contradictory, or unconnected statement about the nature, risk, or return profile of the product.
  1. Excessive complex language, technical or legal terminology, or unnecessary details could annoy investors.
  1. Any reference to a report, analysis, or service as being free unless it is genuinely free and comes with no condition or obligation.
  1. Any assurance that investors would receive an assured or risk-free return. The advertisement may not include any assurance that would give the client the impression that the investment advice, recommendation, or research report is risk-free, immune from market risks, or capable of producing returns with any degree of assurance, such as guaranteed returns, minimum returns, target returns, percentage accuracy, or service provision until target returns are achieved.
  1. Any claims that unfairly compare or discredit other advertising or intermediaries or that directly or indirectly attribute any quality advantage to one intermediary over another.
  1. Reference to the IA/RA’s prior performance.
  1. Superlative phrases used to indicate the IA/RA’s rank or quality, such as no. 1, best, top adviser/research analyst, one of the best, leading among market leaders,” etc. However, accurate information about honours that the IA/RA has won from independent organisations may be published.
  1. Advertisements shall not include the SEBI logo.

Other compliances/requirements

  1. Prior clearance for the advertisement or material must be acquired from a supervisory authority recognised by SEBI (in the case of IAs, this would be the BSE Administration & Supervision Ltd. (BASL)).
  1. Should an IA or RA be suspended by SEBI or by SEBI-approved supervisory authority during the suspension period, the suspended IA or RA is not permitted to publish any advertisements on its own or jointly with any other IA or RA.
  1. The IA/RA must refrain from participating in any competitions, leagues, schemes, games, or other events where prizes, medals, presents, or other items may be awarded.
  1. These rules must be followed by any other investment, research, or consulting firm connected to the IA or RA in question that publishes advertisements mentioning the IA or RA.
  1. According to Section 19(2) of the SEBI (Investment Advisers) Regulations, 2013, and Section 25(2) of the SEBI (Research Analysts) Regulations, 2014, respectively, a copy of the advertising must be kept by IA/RA for a duration of five years.

Applicability of the circular

The guidelines in this circular will take effect from May 1st, 2023. To protect the investor’s interest in the securities market, to encourage the growth of the securities market, and to regulate the securities market, this circular is being issued in reference with the authority given under section 11(1) of the Securities and Exchange Board of India Act (SEBI), 1992.


The purpose of SEBI’s advertisement code for investment advisers and research analysts is to safeguard investors’ interests while fostering the growth and regulation of the securities market. In addition to other compliances and standards, the code specifies rules for all types of communication, information/disclosures, and advertising bans. To maintain honesty and integrity in their interactions with investors, IAs and RAs must ensure that the advertisement code is followed.

Also Read: Why are there Few Registered Investment Advisors in India?


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