The Securities and Exchange Board of India (SEBI) has announced the creation of the long-awaited Past Risk and Return Verification Agency (PaRRVA). This agency will allow Research Analysts (RAs), Investment Advisors (IAs), and algorithmic trading providers to seek verification for their risk-return metrics. According to SEBI’s press statement issued on December 18, the agency will facilitate the marketing of services by regulated entities using verified risk-return data. A Credit Rating Agency (CRA) will act as PaRRVA, with a recognized stock exchange serving as the PaRRVA Data Centre (PDC).

The verification process will focus on services offered by IAs, RAs, and algorithmic trading providers, and will apply only on a prospective basis, starting from the date the service is opted for. PaRRVA will begin as a pilot program for two months, during which feedback from stakeholders will be collected to refine its technological systems and processes. After this period, the agency will operate regularly, though using PaRRVA’s services will remain optional, applicable only to those wishing to verify their past risk-return metrics.