Sebi chief Tuhin Kanta Pandey warns investors against ‘impulsive’ trading, says market volatility is ‘natural’

Securities and Exchange Board of India (Sebi) chairman Tuhin Kanta Pandey on Saturday said India's capital markets are deepening and becoming increasingly resilient, even as global uncertainties continue to cause volatility markets,

Speaking at the second edition of the Moneycontrol Global Wealth Summit 2026 in Mumbai, Pandey advised retail investors not to react impulsively to short-term market movements and instead keep a long-term perspective while investing.

"For retail investors, the best strategy would be to remain patient," he said, adding that markets have historically recovered after major global disruptions.

His remarks come at a time when the Indian stock market has been reeling under the selling pressure for the last two weeks following the outbreak of the US-Iran conflict, which has triggered global risk aversion and volatility.

On top of that, the key benchmark indices of the Indian stock market have remained almost flat for the last 18 months, meaning an investor's portfolio has either remained idle for the last 1.5 years or delivered zero returns during this particular period.

India's capital markets has become ‘resilient’

Pandey added that the country's capital markets are expanding in scale, diversity and strength. "They are deepening, diversified and becoming increasingly resilient. But as markets grow in scale and complexity they also become more closely connected to global developments. And that brings us to the changing landscape in which today's market operates," he said.

Underlining the role of efficient markets, he said: "They enable transparent price discovery. They help absorb shocks without destabilising the broader financial system. And perhaps most importantly, they sustain investor confidence. Efficiency is the foundation of trust in the financial system. Without that, capital hesitates."

Pandey says volatility is natural

Acknowledging the headwinds in global markets, Pandey said a mix of geopolitical tensions, technological disruption and energy shocks is weighing on investor sentiment. "Geopolitical tensions are shaping economic relationships. Conflict in the Middle East has massively disrupted energy supplies. Inevitably, capital markets have been severely impacted," he said.

He added that volatility has become a normal feature of modern financial markets, particularly as the information environment has evolved and shocks spread quickly across economies. However, he stressed that such phases are not permanent: "One lesson becomes clear: periods of extreme volatility don't last forever."

Sebi chief's take on how narratives drive markets

Pandey also pointed to the changes that are reshaping capital markets, saying factors such as economic fragmentation, shifting trade corridors and the growing role of technology are influencing how markets function today. "Algorithmic trading, artificial intelligence and advanced data analytics are accelerating the speed at which markets operate," he said.

He also flagged the rapid flow of information as a growing risk for markets, as he stated, “News travels quickly, opinions travel even faster, and most importantly, markets today react almost instantly to the narratives. And therefore, the question before policymakers and market participants alike is: how do we ensure that speed does not compromise stability?”

What investors should expect?

Setting the stage for what investors can expect going forward, Pandey said capital markets will play a bigger role as India continues its economic journey.

"The next phase of development will require deeper bond markets, stronger institutional participation and continued technological innovation," he said.

He also highlighted steps taken by the markets regulator to protect investors, including monitoring misleading social media content and strengthening surveillance systems such as PaRRVA to detect potential market manipulation and misinformation.

The Past Risk and Return Verification Agency (PaRRVA) system announced in December last year, is a tech-driven initiative, aimed at bringing credibility and consistency to performance reporting through digital audit trails.