Keeping in mind the emerging nature of the securities market in India, SEBI was entrusted with the twin task of both regulation and development of the securities market. 

It also has certain protective functions: 

Regulatory Functions:

• Registration of brokers and sub-brokers and other players in the market. 
• Registration of collective investment schemes and Mutual Funds.
• Regulation of stockbrokers, portfolio exchanges, underwriters, and merchant bankers and the business in stock exchanges and any other securities market. 
• Regulation of takeover bids by companies. 
• Calling for information by undertaking inspection, conducting enquiries and audits of stock exchanges and intermediaries.
• Levying fee or other charges for carrying out the purposes of the Act. 
• Performing and exercising such power under Securities Contract(Regulation)Act 1956, as may be delegated by the Government of India.

Development Functions: 

1. Training of intermediaries of the securities market. 

2. Conducting research and publishing information useful to all market participants. 

3. Undertaking measures to develop the capital markets by adopting a flexible approach. 

Protective Functions: 

1. Prohibition of fraudulent and unfair trade practices like making misleading statements, manipulations, price rigging, etc. 

2. Controlling insider trading and imposing penalties for such practices. 

3. Undertaking steps for investor protection. 

4. Promotion of fair practices and code of conduct in securities market.