Why SEBI wants trading academies to step back from live data

In today’s episode on 9th January 2026, we talk about SEBI’s paper on norms for sharing and usage of price data for educational purposes. ⁠Book your FREE call with Ditto here⁠ https://ditto.sh/vx51ji https://ditto.sh/vx51ji

• 0:00Speaker 00

  Hello folks, you're tuned into Finshots Daily. In today's episode, we talk about Sebi's paper on norms for sharing and usage of prized data for educational purposes. Before we begin, here's a quick word from team Ditto. Life has a way of surprising us and not always in a good way. Sometimes it's a sudden illness or an unexpected hospital visit that can shake up everything. In India, families still pay about 39% of medical expenses directly from their own pockets and just one hospital's take can wipe out years of savings. The easiest way to protect yourself is by getting a good health insurance plan. It's way cheaper than footing one huge bill. And if you're unaware where to start, book a free call with Ditto. No spam, just honest, jargon-free guidance.

• 0:44Speaker 00

  Trusted by over 8 lakh people for their health and term insurance needs. The link is in the description. Now, back to the story. If there's one thing more popular than trading these days, it's people teaching you how to trade. From the comfort of your home, armed with the internet, a smartphone and some savings locked into a DMAT account, anyone can get started. But there's a catch. How do you know which stocks to pick? Which is the best brokerage to use? How much money do you even need to start? These are all questions every new trader asks when they first step into the market. And that's where this story starts off as well. A month ago, Sebi made an example out of a financial influencer who also ran a trading academy under his own name.

• 1:25Speaker 00

  In the process, it clawed back about 546 crore rupees of illegal gains made through the firm. The irony of it was how he made profits from the academy rather than the trading itself. And this wasn't a one-off case, nor was it the first time an individual or institute were caught operating like a trading firm, all under the guise of education, training and guidance. Just last year, the Sebi went after the Asmita Patheer Global School of Trading for a similar pattern. Running a so-called academy that allegedly offered strategies, secret systems and guaranteed returns, while actually functioning like an unregistered advisory service. Students paid for courses but were being effectively funneled into real market positions without the academy holding the licenses required to guide trades.

• 2:09Speaker 00

  Put together, these cases reveal a clear pattern. Individuals and institutes branding themselves as educators, trainers and mentors, but operating suspiciously like trading firms, all under the loosely defined and largely unregulated umbrella of financial education. And this matters because trading isn't a casual hobby. There are real people putting their life savings on the table with every trade they take. So the stakes are quite high for everyone involved and the numbers tell a sobering story. Despite trading volumes dropping in 2025, losses kept mounting. Sebi's latest data shows that 91% of traders active in the equity derivative segment, that's EDS, lost money. Imagine making an investment where you have less than a 1 in 10 chance of retaining your capital for get profits.

• 2:55Speaker 00

  Now that's the reality for most retail traders. Keeping this in mind, these academies couldn't keep getting away with calling themselves traders and educators while offering real-time live data and instructions on the markets. So Sebi's first move came in May 2024 and it started with the data. You see, there were some apps that had gamified virtual trading by using real-time prices of listed companies. Even going so far where users were rewarded for making profits on virtual platforms, even though the price movements were real. And that's when it stepped in and said, "Teach all you want, but only the condition of using one-day lag data." At first glance, it sounded like paper trading had been banned, but that wasn't the case at all.

• 3:36Speaker 00

  When you're paper trading, there's no real risk involved, dummy orders, delayed pricing, and of course, no rewards. It's purely about learning. The real issue was something else entirely. A wave of mock trading apps had started using real-time market prices and then layering on gamified challenges, leaderboard and even cash prizes. So these platforms looked like paper trading but were essentially online stock casinos built on live market movements. Users paid entry fees, competed for rewards and made decisions based on real-time price swings. That's essentially a stock market casino with none of the regulation. A day's lag sounded good enough on paper, but between May 2024 and 25, Sebi's soft influencers weaponized it to conduct almost live trading sessions

• 4:18Speaker 00

  and others used daylight data but presented it as actionable, near-real-time charts. And that's when the real debate started. How much data do you actually need to teach trading? Sebi's logic is simple. If you're genuinely teaching concepts, strategies or market behavior, there is no- Need for real time or near real time data in the classroom. You can explain candlesticks, volatility, support or resistance or risk management just fine with the data that's a few weeks old. But the moment fresh price data enters the classrooms alongside trading strategies. Education starts looking a lot like informal investment advice and that's the loophole many creators and platforms have been exploiting.

• 4:58Speaker 00

  They present themselves as educators but use almost life prizes to guide people trading decisions without being regulated. Sebi's challenge is to keep education authentic and useful without letting this grey zone become a backdoor for unregistered advisory. Some argue that these academics are just teaching but many of their students continue to trade based on the guru's signals long after the course ends. So multiply that by thousands of followers and you're no longer looking at education and none of it falls under Sebi's advisory or suitability rules. That's why in Jan 2025, Sebi tightened the screws again. Its circular clarified that a three-month data lag would be acceptable for educational use. Whether it involved stock names, price data or even future price indicators. But this three-month rule had problem of its own.

• 5:43Speaker 00

  For instance, you can't teach certain concepts like price action with data that's at least a quarter old. And even Sebi agreed that educational value from fresher data would be more useful. So, the regulator went looking for a middle ground and that's where the latest draft paper comes in. It proposes a uniform thirty-day data lag across the board for educational use cases. If a course genuinely focuses on teaching concepts, it can easily work with data that's thirty days old. Because learning doesn't depend on reliance's exact prices today, it depends on understanding why prices move. And even if an institute genuinely feels it needs fresher data, the pathway already exists. Register as an investment advisor and play by the rules just as everyone else.

• 6:25Speaker 00

  Trading education isn't illegal in India, giving trading tips without being a registered investment advisoress. And that's why so many of these outfits call themselves academics. The label lets them teach strategies, hint at entry-exit points and walk right up to the advisory line. Without ever taking on the responsibilities that come with being regulated. This draft paper, Sebi is finally drawing that line clearly. Educators can still teach, but they must use thirty day old data. And they must continue to steer clear of any advisory-like behaviour that the Jan 2025 circular already prohibited. So, yes, that's why Sebi has pushed out this draft. For the time being though, it is open for public comment, but the message is already clear. If you're truly an academy, you don't need live data to teach.

• 7:09Speaker 00

  And if you insist that you do, then the writing is simple. Register as an RIA or phase music. Thank you for listening to today's episode. And if you want to share your feedback or suggestions, do drop us an email to [email protected]. Until next time.