You see Life insurance companies advertise their products with cricketers and celebrities.
However Mutual Funds / Asset Management Companies are not allowed to do so, because the advertising guidelines are quite strict. This is because mutual funds are market linked products.
SEBI in its last circular allowed this, but only at an industry level for investor awareness. A celeb cannot push a particular AMC’s product.
Secondly SEBI also restricts the expense on celeb endorsements even or investor awareness.
There are other smaller issues involved:
- What if a celeb pushes a particular AMC and market goes down after that? A celeb would not want to take such a risk.
- What if the celeb gets caught in a scandal? Would the AMC like to take such a risk
As an investor do stay away from products that are pushed aggressively. Ultimately you pay for the promotion.
This also includes free platforms that are pushed aggressively. Stay away. Remember that if something is free, then you are the product.
