The Hidden Risks of Investing Based on Social Media Trends

Social media has become a major source of investment information for Indian investors. But the data shows a wide gap between the influence finfluencers have and the little accountability they face.

Most Finfluencers Aren’t Even Registered

Only 6% of finfluencers studied in 2026 are SEBI-registered, up from just 2% in the previous year — yet 33% continue to provide explicit stock recommendations, a figure that hasn’t budged. This means two out of three investors following stock tips on social media are likely getting advice from someone with no regulatory accountability at all.

Disclosure Is Often Missing

Nearly two out of three finfluencers studied failed to adequately disclose sponsorships or financial affiliations, making it difficult for investors to tell whether a recommendation is genuine analysis or a paid promotion. Separately, over a quarter did not disclose important investment-related risk information alongside their content.

The Scale of the Problem Is Growing

As of February 2026, SEBI has escalated over 1.33 lakh instances of misleading or manipulative social media content to platforms for removal, with more recent enforcement flagging over 20,000 additional posts using its AI-based monitoring tools. Despite this, SEBI does not currently deploy full AI surveillance, relying partly on manual coordination with platforms.

Investors Are More Influenced Than They Realise

A SEBI investor survey found that 62% of investors who follow financial influencers said their decisions were directly influenced by them, with about 93% rating these influencers as moderately or highly credible. That level of trust, combined with low registration rates, is exactly the gap regulators are trying to close.

What You Should Do Next

1. Check whether a finfluencer is SEBI-registered before acting on any stock recommendation.
2. Treat undisclosed sponsorships as a red flag, not a minor detail.
3. Cross-verify any social media stock tip against company filings and exchange disclosures.
4. Build your core wealth plan — like a ₹1 crore SIP strategy — around registered advisors, not trending reels.

The Time to Verify Before You Invest Is Now

Social media can educate, but it shouldn’t replace due diligence. Speak with the experts at ashikawealth.in before acting on any investment trend you see online.

Disclaimer: Investments in the securities market are subject to market risks. Read all related documents carefully before investing. Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

Sources: CFA Institute Research & Policy Centre, Outlook Money, Business Standard, LapaasVoice