21.

In a securities market, what will be the steps in

customer acquisition and customer retention?
Meaning of Customer Acquisition

Put basically, client obtaining alludes to increasing new shoppers. Obtaining new clients
includes influencing customers to buy an organization's items as well as administrations.
Organizations and associations consider the expense of client obtaining as a significant
measure in assessing how much esteem clients bring to their organizations.

Client Acquisition the board alludes to the arrangement of approaches and frameworks for
overseeing client prospects and request that are produced by an assortment of promoting
strategies. Some fruitful client procurement procedures incorporate client referrals, client
faithfulness programs, and so forth.

One approach to consider client procurement the board is to think of it as the connection
among publicizing and client relationship the board, as it is the basic association that
encourages the securing of focused clients in a viable manner.

Client Acquisition Process

Client procurement requires thinking ahead and techniques. Actually, there are a wide range
of client procurement methodologies that are utilized as a major aspect of the client
obtaining process.
Some client obtaining strategies are progressively compelling with explicit sorts of
customers, however, there are a couple of essential advances that are incorporated
into a client procurement plan.

The initial step of any essential client securing plan is to recognize quality potential clients.
One client procurement procedure includes connecting with potential clients through call
focuses and mailing records.

These client procurement techniques enable organizations to figure out which people and
organizations express enthusiasm for or as of now use items like those of your
organization. Next, organizations qualify the leads a little further utilizing different
research techniques to decide the feasibility of the given lead. In the event that the
odds appear to be likely that you will have the option to procure this new client, his status is
moved up to that of prospect and doled out to a salesman for further communication.

Numerous client procurement programs at that point incorporate building up an

association with prospects to distinguish their needs and decide how the items offered to
identify with those requirements.

Sales reps likewise endeavor to recognize implicit needs; these depend on information
furnished by continuous discussions and connections with the prospects. Sales reps
likewise can recognize extra needs of prospects and offer extra items so the prospects
see a more noteworthy incentive from buying the items they as of now are thinking
about.

The exact opposite thing an organization needs to do is spend more on securing clients
than the clients spend and also know the Factors Improving Conversion Rates for Local
Businesses. The expense of client procurement (CAC) is the value organizations pay to get
new clients. In its easiest structure, the CAC is controlled by partitioning the all-out expenses
related to procurement by absolute new clients, inside a particular timeframe.

The expense of client securing is a significant measurement for organizations to

consider, alongside the lifetime estimation of a client. Organizations and associations
need to get an arrival on venture (ROI) from promoting and deals battles intended for a
client obtaining.

Benefits of Customer Acquisition

Utilizing proper client obtaining systems causes organizations to develop, and focused on
client securing projects help organizations procure the correct clients in a financially savvy
way. New organizations or those with less settled items particularly need to put a more
prominent spotlight on client securing.
As organizations develop, they can move their concentration to client maintenance.
It's  critical to remember that client obtaining costs frequently are higher than client
maintenance expenses  and in this manner require an intensive examination of the related
advantages.

Customer retention management strategy # 1 – Provide exceptional support to

provide better

Everyone knows the importance of customer support, but if you go through the extra mile
for your customers, they’ll remember that and stay loyal to your brand.

Establish from the beginning that you’re available to help, and happy to do so. A simple
“get help” or “contact us” button goes a long way on your website as customers value
communication as long as you do your part.

Did you know live chat has the highest satisfaction level for any customer service channels?
At a whopping 73%, according to a study by Econsultancy, compared to 61% for emails and
44% for phones.

Having exceptional customer support is underrated.

We often take making a purchase a very easy and a straightforward process, especially if

your site has great UX. But customers are always curious and ready with specific questions
about the product they’re going to use.

If done well, providing high-quality help can be the difference between a customer that’ll
come back to your site or go somewhere else. People appreciate the small things like
support that helps with all of their concerns and questions. And from your side, it’s an easy
way to retain customers, and understand them better.

The more you interact with them, the better it is for everyone involved.

But regardless of the platform, your communication tone should be the same. Be
straightforward and kind, and your customers will thank you in return.

A little kindness goes a long way.

Customer retention management strategy # 2 – Measure and listen

Once you establish a clear communication system with your customers, the next thing you
might want to do is take a step back and listen.

This is one of the best ways to grow as a business as you get to better understand your
target market.
In addition to improving your overall customer retention and customer support, you’ll be
able to gain the gained insights and apply it to other parts of your marketing and business.
After all, analytics and the data are the backbone of marketing.

If you want to make an important decision, you’ll need to know how your customers will
react to it. Creating acustomer profile once you get to know them enough is a really great
way to tap into their minds.

Look at each touch point you have with your customers and see if you can improve it. Listen
attentively to what your customers have to say, and apply that feedback accordingly.

Consider your customers’ complaints. Criticism is better than silence on their part, because it
gives you an area you can improve in. Most customers click away without leaving any
feedback, so, take each of their comments (negative and positive ones) and see how you
can capitalize on that.

There’s a lot to learn from criticism.

Once you build a close relationship with your customers, you can then ask and receive
feedback. You can then use this information to increase sales, acquire new
customers, and better retain your current ones.

Listening may be a passive activity, but it’s an important one nonetheless and can drastically
affect your business.

Customer retention management strategy # 3 – Gather social proof

Having a hungry and a loyal customer base is the dream for all businesses. But this is easier
said than done since brand loyalty has been decreasing over the years. When people can
click away and find another alternative within seconds of looking at your website, it can be
hard to capture their attention and stop them from seeking an alternative.

One particularly effective solution is gathering and cultivating social proof – and presenting
it to your readers.

Just about everyone reads reviews before making a decision. 94% of all customers read
online reviews, and 72% don’t take action until they’ve read one (Source).

So, what does this say about your customer retention strategy?

People are thirsty for information and feedback that will help them make a decision. As a
business, it’s your responsibility to give it to them.

In other words, when your customers want to spend money, you have to eliminate any
reluctance they might have.

Reviews, testimonials, social media interactions, and more, are all great indicators of social
proof. Most businesses’ social media pages tend to be public and easily accessible. So, any
curious customers can take a sneak peek at your profile to see what others are saying.

How you present yourself and how you’re interacting with your current and new customers
drastically affects how your audience sees you.

Customer retention management strategy # 4 – Offer incentives

Incentives come in many shapes and forms – discounts, giveaways, exposures, and so on.
And they’re all a great way for customers to interact with your brand.

Sometimes, all your customers need is a little bit of encouragement. So, you can always try
to push them to purchase if you find that they’re hesitant.

At the end of the day, customer retention management is about brand loyalty. And brand
loyalty is like a good friendship. You need trust, continued communication, and sometimes
even free gifts to keep it going and take it to the next level.

Just because a customer once bought something from you, doesn’t mean they will a second
time. But it’s a good idea to incentivize them anyway to turn them into forever customers.
This begins with continued interaction with your brand. So, first, get your customers to
follow you on social media and make sure you’re offering high-quality value there so they
stay.

Then, once you’re in their social media feeds, you have a lot of ways to provide incentives
and customer interaction. Your options may be based on your product and type of
promotion you offer, but regardless of your niche, remember everyone loves free stuff and
discounts.

So, feel free to get creative in that regard.

Customer retention management strategy # 5 – Personalization is key

If you truly care about your customers – show it.

And if you truly want to leave a lasting impression and turn a repeat customer into a loyal
one – get personal.
Take the time out of your day, and write a simple and a personal hand-written note where
you address your customers personally. This attention to detail will not only help you stand
out from your competitors, but also lets your customers know that you do care.

What’s more likely to leave a lasting memory?

A personal hand-written letter or an email template filled out with the bare minimum
personalization?

These considerations go a long way with your customer retention management and
relationship and can create a loyal customer for life. The more personal and unique to your
brand – the better.

Marketing should be personal. If a customer reads your message and feels as if you’re
they’re talking with you one-on-one, then you’re on the right track.

According to a 2014 study, those investing in personalization report a 14% uplift in sales on

average. In addition to that, personalization also improves customer experience, branding,
and your overall positioning.

To better keep track of your overall customer-relationship and retention management,

consider investing in a CRM software. Use what information you know about your
customers wisely so that you can personalize your communication in the future.

At the end of the day, even though gaining new customers is a sign of a growing business,
losing customers is too expensive. And retaining your customers is cheaper than acquiring
new ones.

Your current customers can increase your overall profits, as they’re more likely to buy from
you than new prospects. To make that happens, you can employ the above 5 customer
retention management strategies and invest in a CRM to better organize your relationship.

While it is true that the more customers you acquire, the higher your profits will be, the
same also applies to customer retention.

If you want to increase your profits and gain loyal and repeat customers though – focus on
customer retention

On what basis securities should be selected?

Free float market capitalization:

In free float market capitalisation, the value of the company is calculated by excluding shares held by the promoters.
These excluded shares are the free float shares.For example if a company has issued 10 lakh shares of face value
Rs 10, but of these, four lakh shares is owned by the promoter, then the free float market capitalisation is Rs 60 lakh.
3. How does free float market capitalisation differ from total market capitalisation?
Free float market capitalisatio ..

Read more at:

https://economictimes.indiatimes.com/markets/stocks/news/free-float-market-capitalisation-determines-index-
weightage/articleshow/58178327.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Different types of equity:

Before jumping into different forms of equity, let’s quickly review what business equity
is.

Business equity represents ownership in a company. Equity can be the amount you

invest in your business. Or, business equity can refer to the value of your company.

To measure your business equity, look at the relationship between your business’s
assets and liabilities by using the following formula:

Equity = Assets – Liabilities

Equity can also be broken down further, depending on your type of business structure.
Two common types of equity include stockholders’ and owner’s equity.
Stockholders’ equity
Stockholders’ equity, also known as shareholders’ equity, is the amount of assets given
to shareholders after deducting liabilities.

Stockholders’ equity is common for businesses structured as corporations. To see how

much money is available for a shareholder distribution, look at shareholders’ equity.
Owner’s equity
Owner’s equity refers to the amount of ownership you have in your business. You can
calculate owner’s equity by subtracting your liabilities from your assets. Owner’s equity
shows you how much available capital your small business has.

Owner’s equity is most common for a sole proprietor or business partner.

Types of equity accounts

Now that you’ve had the chance to brush up on types of business equity, let’s get down
to the nitty-gritty.

There are various types of accounts used to record equity. Types of equity accounts
differ depending on your type of business. Use these accounts to record equity on
your business balance sheets.

Different accounts appear in the equity section of your balance sheet. And, your
liabilities and equity must equal your assets on your balance sheet.

Review the most common types of equity accounts below.

Common stock
Common stock, or common shares, is an equity account representing the initial
investment in a business. This type of equity gives its shareholders the right to certain
company assets.
 You usually record common stock at the par value of the stock. Par value simply means
the face value of the stock.

You can calculate common stock by multiplying the stock’s par value by your total
number of outstanding shares.

Typically, common stock investors have more control over the direction of a business.
Common stock owners also have many responsibilities in a company, including:

 Officer appointments
 Board elections
 Basic corporate governing
 Determining policies

Preferred stock
Preferred stock is similar to common stock. However, preferred stock owners have
fewer responsibilities and no voting rights (e.g., electing board members).

Preferred stockholders have more ability to claim a company’s assets and earnings.
And, investors can receive cash payments in the form of dividends.

Additional paid-in capital

An additional paid-in capital equity account accumulates the additional amount investors
pay for shares above its par value. This type of equity account may also be referred to
as contributed surplus.

The balance in an additional paid-in capital account can be much higher than other
accounts. And, the amount can change as the company experiences gains and losses
from selling shares.
Treasury stock
Some businesses may opt to purchase stock back from common stockholders. This is
where treasury stocks come into play.

Treasury stocks account for the amounts paid to buy shares back from investors. And,
this type of equity account is usually a negative balance.

In most cases, you reflect this in your accounting books as a deduction from total equity.

Retained earnings
A retained earnings account shows the earnings your business accumulates, minus any
dividend payments made to shareholders. Essentially, your retained earnings are your
portion of net income that you did not pay out as dividends.

You can use your retained earnings for investments. And, you may opt to save your
retained earnings for the future.

IPO vs FPO
BASIS FOR
IPO FPO
COMPARISON

Meaning Initial Public Offering Follow-on Public Offering

(IPO) refers to an offer of (FPO) means an offer of
securities made to the securities for subscription to
public for subscription, by public, by an publicly traded
the company. enterprise.

What is it? First public issue Second or third public issue

 BASIS FOR
IPO FPO
COMPARISON

Issuer Unlisted Company Listed Company

Objective Raising capital through Subsequent public

public investment. investment.

Risk High Comparatively low

Private Placement vs preferential Alloment

BASIS FOR PRIVATE PREFERENTIAL
COMPARISON PLACEMENT ALLOTMENT

Meaning Private Placement refers Preferetial Allotment, is the

to the offer or invitation to
offer made to specified
investors, for inviting
them to subscribe for
shares, so as to raise
funds.
allotment of shares or
debentures to a selected
group of persons is made by
a listed company, to raise
funds.

Governed by Section 42 of the Section 62 (1) of the

Companies Act, 2013 Companies Act, 2013

Offer letter Private placement offer No such document

letter

Consideration Payment is made by way Cash or consideration other

of cheque, demand draft than cash.
or other modes except
cash.

Bank account To keep the application Not required.

 BASIS FOR PRIVATE PREFERENTIAL
COMPARISON PLACEMENT ALLOTMENT

money, separate bank

account in a scheduled
commercial bank is
required.

Articles of Articles of association of No authorization is required.

association the company must
authorize it.

Depository
A depository is an entity which helps an investor to buy or sell securities such
as stocks and Bonds in a paper-less manner. Securities in depository
accounts are similar to funds in bank accounts. A depository institution
provides financial services to personal and business customers. Deposits in
the institution include securities such as stocks or bonds. The institution
holds the securities in electronic form also known as book-entry form, or in
dematerialized or paper format such as a physical certificate. Companies
become members of depositories and keep electronic records of all their
issued equity and debt securities with the depositories.

Risk-Return Relationship:
# Risk vs. Return

‘Total return’ has 2 components -

 Capital gains : measures difference in price levels. (‘Alpha' measures excess

return over benchmark return)
 Dividend/Coupon income : measured as dividend/yield at a given price level
‘Total risk’ has 2 components -

 Unsystematic risk : variation in prices attributed to factors specific to the

company
 Systematic risk (‘Beta') : variation in prices attributed to market volatility
Risk adjusted return : ‘Return’ and ‘Risk’ variables are related through CAPM (capital asset
pricing model), in determining ‘cost of equity'

 E(r) = Rf + B*(Rm - Rf)

o E(r) - Expected return or Cost of equity (i.e. min. return expected
from buying the asset/stock)
o Rf - risk-free rate of return (available in the economy)
o B - beta (variation in asset/stock prices attributed to market
volatility, calculated through regression)
o Rm - market return
o (Rm - Rf) - market risk premium (i.e. excess of market return over
risk-free rate)

Market scenarios : Risk-on vs. Risk-off

 Risk-on : It occurs usually when market risk (i.e. volatility) is expected to be

lower. Hence, risk-on rally takes place when investors chase risk assets (like equity)
due to higher expectation of market returns. Preference for high risk stocks (i.e.
high beta relative to market) usually increases in risk-on scenario.
 Risk-off : It occurs usually when market risk (i.e. volatility) is expected to be
higher. Hence, risk-off takes place when investors shun risk assets (like equity) due
to lower expectation of market returns. Preference for high risk stocks (i.e. high
beta relative to market) usually decreases in risk-off scenario.

Investor types : Conservative vs. Aggressive

 Risk averse (conservative investor) : lower preference for high volatility assets
 Risk seeker (aggressive investor): higher preference for high volatility assets

What is Demat Account?

Demat Account is an account that is used to hold shares and securities in electronic format. The
full form of Demat account is a dematerialised account. The purpose of opening a Demat
account is to hold shares that have been bought or dematerialised (converted from physical to
electronic shares), thus making share trading easy for the users during online trading.

In India, Free Demat account service is provided by depositories such as NSDL and CDSL

through intermediaries / Depository Participant / Stock Broker such as Angel Broking. The
charges of Demat account vary as per the volume held in the account, type subscribed, and the
terms and conditions laid by the depository and the stock broker.

What is Demat account?

Demat Account or dematerialised account provides facility of holding shares and securities in
electronic format. During online trading, shares are bought and held in a Demat account, thus
facilitating easy trade for the users. A Demat Account holds all the investments an individual
makes in shares, government securities, exchange-traded funds, bonds and mutual funds in one
place.

What is dematerialisation?
Dematerialisation is the process of converting the physical share certificates into electronic form,
which is a lot easier to maintain and is accessible from anywhere throughout the world. An
investor who wants to trade online needs to open a Demat with a Depository Participant (DP).
The purpose of dematerialisation is to eliminate the need for the investor to hold physical share
certificates and facilitating a seamless tracking and monitoring of holdings.

Is it necessary to have a demat account to deal in

securities?
Yes! A demat account can only be operated through a trading account. In the sense, in
order to buy and sell shares in your demat account you will have to route it through your
trading account.

You can link one demat account to several trading accounts of different brokerages but I
would not recommend it as it creates a hassle while selling. You can get in touch with us for
more information about this.

Bonds and Debentures

A bond is a loan to a company or government that pays back a fixed rate of
return. It's a safer investment than stocks, but still has risks.
 KEVIN VOIGT & ALANA BENSON
May 21, 2020
Investing, Investments

Many or all of the products featured here are from our partners who compensate us. This may influence
which products we write about and where and how the product appears on a page. However, this does
not influence our evaluations. Our opinions are our own.
Bonds are an asset class. Investors in bonds lend a government or business money for
a set period of time, with the promise of repayment of that money plus interest.

Bonds are a key ingredient in a balanced portfolio. Most investment portfolios should

include some bonds, which help balance out risk over time. If stock markets plummet,
bonds can help cushion the blow.

Quick facts about bonds

 Definition: A bond is a loan to a company or government that pays investors a fixed rate of return
over a specific timeframe.
 Average returns: Long-term government bonds historically earn around 5% in average annual
returns, versus the 10% historical average annual return of stocks.
 Risks: A bond’s risk is based mainly on the issuer’s creditworthiness.
 Advantages: The relative safety of bonds helps balance the risks associated with stock-based
investments.
 

How do bonds work?

Bonds work by paying back a regular amount, also known as a “coupon rate,” and are
thus referred to as a type of fixed-income security. For example, a $10,000 bond with a
10-year maturity date and a coupon rate of 5% would pay $500 a year for a decade,
after which the original $10,000 face value of the bond is paid back to the investor.

» Ready to add bonds to your portfolio? See our guide on how to buy bonds.

Types of bonds
Bonds, like many investments, balance risk and reward. Typically, bonds that are lower
risk will pay lower interest rates; bonds that are riskier pay higher rates in exchange for
the investor giving up some safety.

U.S. Treasury bonds. These bonds are backed by the federal government and are
considered one of the safest types of investments. The flip side of these bonds is their
low interest rates. Federal bonds are in it for the long-term — they are issued in terms of
20 or 30 years.
Corporate bonds. Companies can issue corporate bonds when they need to raise
money. For example, if a company wants to build a new plant, it may issue a bond and
pay a stated rate of interest to investors until the bond matures and the company repays
the investor the principal amount that was loaned. Unlike owning stock in a company,
investing in a corporate bond does not give you any ownership in the company itself.
Corporate bonds can be either high-yield, meaning they have a lower credit rating and
offer higher interest rates in exchange for a higher level of risk, or investment-grade,
which means they have a higher credit rating and pay lower interest rates due to lower
risk.

Municipal bonds. Municipal bonds, also called munis, are issued by states, cities,
counties and other nonfederal government entities. Similar to how corporate bonds are
used to fund company projects or ventures, municipal bonds are used to fund state or
city projects, like building schools or highways.
Unlike corporate bonds, municipal bonds can have tax benefits  — bondholders may not
have to pay federal taxes on the bond’s interest — which can lead to a lower interest
rate. Muni bonds may also be exempt from state and local taxes if they’re issued in the
state or city where you live.

Municipal bonds can vary in term: Short-term bonds will pay back their principal in one
to three years, while long-term bonds can take over ten years to mature.

The pros and cons of bonds

Pros
Bonds are relatively safe. Bonds can create a balancing force within an investment
portfolio: If you have a majority invested in stocks, adding bonds can diversify your
assets and lower your overall risk. And while bonds do carry some risk (such as the
issuer being unable to make either interest or principal payments), they are generally
much less risky than stocks.
Bonds are a form of fixed-income. Bonds pay interest at regular, predictable rates
and intervals. For retirees or other individuals who like the idea of receiving regular
income, bonds can be a solid asset to own.

Cons
Low interest rates. Unfortunately, with safety comes lower interest rates. Long-term
government bonds have historically earned about 5% in average annual returns, while
the stock market has historically returned 10% annually on average.
Some risk. Even though there is typically less risk when you invest in bonds over
stocks, bonds are not risk-free. For example, there is always a chance you’ll have
difficulty selling a bond you own, particularly if interest rates go up. The bond issuer may
not be able to pay the investor the interest and/or principal they owe on time, which is
called default risk. Inflation can also reduce your purchasing power over time, making
the fixed income you receive from the bond less valuable as time goes on.

Debentures
A debenture is an instrument used by a lender, such as a bank, when providing capital
to companies and individuals. It enables the lender to secure loan repayments against
the borrower’s assets – even if they default on the payment.

A debenture can grant a fixed charge or a floating charge. A fixed charge is normally
taken out against a tangible asset such as property. It enables the lender to take
ownership of the borrower’s assets and sell them off in the event of a payment default.
With a fixed charge, the borrower would not be able to sell the asset without the lender’s
consent.

A floating charge – which is usually attached to assets such as shares, raw materials
and intellectual property – implies that the assets may change over time, and the
borrower can sell them without the lender’s intervention. However, floating charges may
become fixed if the borrower defaults.

US vs UK debentures
In the US, the term debenture takes on a slightly different meaning to the UK. In the US,
a debenture is a medium to long-term loan, issued to a company by an investor. Think
of it as an unsecured loan that is supplied in good faith – unlike UK debentures, the loan
is not backed up by physical assets; only by the company’s good reputation in the eyes
of the investor. The loan must be settled at a fixed interest rate, but the money raised is
used as capital for the business.

There are two types of debentures in the US – convertible and non-convertible. A

convertible debenture can be exchanged for the company’s shares during a certain
period and often offer lower interest rates. A non-convertible debenture cannot be
converted into shares and often carries a higher interest rate.

If the company defaults on the loan, the investor may claim any tangible assets, even if
they were not pledged on the initial agreement.

How do debentures work?

Put simply, the borrower issues a debenture via an agreement called an indenture.
Depending on the country of issue, this agreement outlines details such as the amount
of the loan, its convertibility, interest rate and maturity date. Then, the investor lends the
funds to the borrower and expects repayments at the agreed interest rate.

Example of a debenture
Let’s say company ABC issues a debenture to the value of CHF 100,000, redeemable
on 31 December 2019. This is the date on which the company will receive the loan
back. It bears 5% interest per year, payable on 31 July every year. An investor agrees
to offer the loan at a fixed charge. If ABC defaults on the payment, the investor may
now sell the company’s assets to raise the capital needed to fulfil the loan.

Pros and cons of debentures

Pros of debentures
Pros for the lender
Debentures can be financially rewarding for investors because they pay interest –
usually at a much higher rate than bonds or other investments. Another benefit to
investors is that convertible debentures can be exchanged for shares. Lastly,
debentures are transferrable between financiers, so an investor does not have to hold
onto the debenture if they don’t want to.

Pros for the borrower

Debentures provide funds for the company or individual, and the loans are not restricted
in terms of how much they can borrow – unlike regular loan options.

Cons of debentures
Cons for the lender
Debentures carry different types of risk, including interest rate risk and inflationary risk.
Because debentures are repaid on a fixed interest basis, the lender may lose out if
interests rates rise. Furthermore, interest payments may not be in line with changing
inflation.

Cons for the borrower

The downside for the borrower is that they have little financial flexibility because the
interest payments are compulsory. And, if they cannot repay the loan, they may suffer
other losses, as outlined in the indenture. This means that the company who issues the
debenture may lose more than they borrowed.

Bonds vs Debentures
BASIS FOR
BONDS DEBENTURES
COMPARISON

Meaning A bond is a financial A debt instrument used to

instrument showing the raise long term finance is
indebtedness of the known as Debentures.
issuing body towards its
holders.

Collateral Yes, bonds are generally Debentures may be

 BASIS FOR
BONDS DEBENTURES
COMPARISON

secured by collateral. secured or unsecured.

Interest Rate Low High

Issued by Government Agencies, Companies

financial institutions,
corporations, etc.

Payment Accrued Periodical

Owners Bondholders Debenture holders

Risk factor Low High

Priority in repayment First Second

at the time of
liquidation

Effect of Demonetization in security market?

PROS/THE GOOD THINGS

 Eimination of counterfeit currency

It is not rocket science to understand that counterfeit currency is generally circulated in
highest denomination notes to impact most. So, by demonetizing the highest currency
notes India could almost eliminate 100% fake currency out of circulation in one stroke.

 Abolish black money

People having black money generally keep their black money in highest denomination
currency notes. This step would abolish black money from the economy as the owners will
not be in a position to deposit the same in the banks.
This step would make black money kept in cash which generally used to create chaos and
terror or is lying with terrorists, Maoists, naxalites, scrap.

 Strengthen Indian Banking System

This will automatically lead to more amounts being deposited in Savings and Current
Account cash laying out of economy flow is now coming into circulation. This in turn will
enhance the liquidity position of the banks, which can be utilized further for lending
purposes.

 Financial inclusion for Jan Dhan account holders

Government opened Jan Dhan accounts for financial inclusion purpose, but people were
reluctant to keep money in the bank, but after this step of government, people will start
depositing their cash into banks thereby strengthening Indian banking system, citizen are
and will become beneficiaries of financial inclusion!

 Higher Tax Collection

This led to higher tax collection as business men are depositing cash lying with them as
current year income with advance tax. Defaulters of bank, property tax, electricity bills and
telecom bills are clearing their long pending bills and thus utilizing their old currency notes.

 Deflation
Price level is expected to be lowered only marginally and temporarily due to moderation
from demand side.

Small vendors who generally deals in cash would now start using cashless modes for
transactions or digital methods.

 Price cut in Real estate

As we all know the hype in real estate prices is because of the circulation of black money in
this market. Now from this step almost all that black money would get out of circulation
from this sector. Eventually the sky touching prices of properties will come down to the
reach of a common man. Finally a common man can buy his dream home soon. Hopefully!

 This Step will make Rupees Strong.

How? Let’s understand.

Currency exchange rate of any country depends upon reserve assets which includes a
country’s holding of foreign currency and deposits, securities, gold, IMF special drawing
rights (SDRs), reserve position in the IMF, and other readily available claims.

Let’s take an example.

Assume India has a reserve assets as 100 kg. Gold against which government has issued Rs.
500000 on the other hand USA with same reserve assets issues $100000.
Now it means 1 kg gold would cost Rs.5000 in India and $1000 in USA ($ purchasing power
far better than Rs.) (Assuming all other factors affecting value of currency as constant.)

Now from above equation we can draw a conclusion that Rs.5000 = 1000 dollar. It mean 5
rupees is equal to 1 dollar.

Now this step will throw the black money out of circulation. Eventually bank will received
less money. According to RBI’s data total value of currency in form of Rs.500 and
Rs.1000notes is 16 lakh Crores. Now suppose, if out of this even 4-5 lack crore rupees are
counterfeit or unaccounted money which were in circulation. Eventually the government will
also print less money, it means value of rupees will increase in comparison to foreign
currency.

It will enhance the value of Rupee common people holding. It will result into cheaper
foreign imports, cheaper study in abroad etc.

 A Speed Breaker for Corruption

This step of government will subdue corruption up to a certain level and for a considerable
time period which in return will attract foreign investor to Indian market. Indian market has
been the first choice of investors considering it’s large size and huge number of consumers.
Till now they were reluctant to invest in India because of prevalent corruption and red-
tapism. Now we can say that India has overcome both the barriers.

 Bank Rate Cut

Larger the money in circulation results in better the conditions of banks now banks no
longer for a considerable time from now face liquidity issues. That will result into lower Bank
rates. You will have to pay less interest on EMIs.

CONS/THROUGH THE GLASSES OF PESSIMISM

 Adverse impact on informal sector

Players of informal sector as they mainly deals in cash only are facing tough time due to this
Demonetization scheme already. Sudden removal of cash from market put their business on
a dormant phase.

It is important to understand that their income is not black as they don’t come under
income tax slab because of less income which has become even lesser now.

 Plight of Primary Producers

Lack of liquidity would result in distress to primary producers who don’t have much money,
so that they could hold their produce for long and on the other side due to lack of currency
in flow they are offered very less by the buyers in the market.
  Non-acceptance of Old currency regardless Government Orders
Many prescribed business houses and establishments are not accepting old currency
notes from common people, thus leaving them helpless. The fact that such people have no
remedy against such people/ business houses make the situation worst.
Milk Booths, Chemists, Petrol Pumps and Safal Stores etc. are among others. These are
dealing with basic necessities of common people.

 Possibility of breaking Riots

There are many anti-state elements present in the society who are trying to spread
unrest in the society. They can exploit the situation and incite those disheartened people
to make a platform to break riots.

 Excessive burden on bank employees

This is a clear fact that there is an excessive burden on bank employees to cope up with
the situation and even after working so hard they are not able to satisfy the need of
people.

 Decrease in demand
This is a fact that black economy do support the real economy from demand side, that is to
say black money used by the consumers to buy goods or services increases demand for
those. Although you may say this is unethical or wrong but it is beneficial from economy’s
point of view.

 Violation of rule by general public

Many people are entering ATMs and using 3-4 different ATM cards and withdrawing 4X
cash than the prescribed limit for one person, thus violating the limit prescribed by the
government.

 Chances of incarnation of De facto currency

De facto currency is a currency that is not recognized by the government as legal tender,
but is accepted by a majority of the population. The US Dollar, for example, is accepted in
Cambodia as a de facto  currency. Similarly if required money is not injected into the
circulation there are chances that people belonging to different regions would start using
old currency as de facto currency.

What are the counter-inflationary mehods

adopted?
Some of the important measures to control inflation are as follows: 1.
Monetary Measures 2. Fiscal Measures 3. Other Measures.
Inflation is caused by the failure of aggregate supply to equal the
increase in aggregate demand. Inflation can, therefore, be controlled
by increasing the supplies of goods and services and reducing money
incomes in order to control aggregate demand.

ADVERTISEMENTS:

The various methods are usually grouped under three heads:

monetary measures, fiscal measures and other measures.

1. Monetary Measures:
Monetary measures aim at reducing money incomes.

(a) Credit Control:

One of the important monetary measures is monetary policy. The
central bank of the country adopts a number of methods to control the
quantity and quality of credit. For this purpose, it raises the bank
rates, sells securities in the open market, raises the reserve ratio, and
adopts a number of selective credit control measures, such as raising
margin requirements and regulating consumer credit. Monetary policy
may not be effective in controlling inflation, if inflation is due to cost-
push factors. Monetary policy can only be helpful in controlling
inflation due to demand-pull factors.

(b) Demonetisation of Currency:

However, one of the monetary measures is to demonetise currency of
higher denominations. Such a measures is usually adopted when there
is abundance of black money in the country.
(c) Issue of New Currency:
ADVERTISEMENTS:

The most extreme monetary measure is the issue of new currency in

place of the old currency. Under this system, one new note is
exchanged for a number of notes of the old currency. The value of
bank deposits is also fixed accordingly. Such a measure is adopted
when there is an excessive issue of notes and there is hyperinflation in
the country. It is a very effective measure. But is inequitable for its
hurts the small depositors the most.

2. Fiscal Measures:
Monetary policy alone is incapable of controlling inflation. It should,
therefore, be supplemented by fiscal measures. Fiscal measures are
highly effective for controlling government expenditure, personal
consumption expenditure, and private and public investment.

ADVERTISEMENTS:

The principal fiscal measures are the following:

(a) Reduction in Unnecessary Expenditure:
The government should reduce unnecessary expenditure on non-
development activities in order to curb inflation. This will also put a
check on private expenditure which is dependent upon government
demand for goods and services. But it is not easy to cut government
expenditure. Though this measure is always welcome but it becomes
difficult to distinguish between essential and non-essential
expenditure. Therefore, this measure should be supplemented by
taxation.
(b) Increase in Taxes:
To cut personal consumption expenditure, the rates of personal,
corporate and commodity taxes should be raised and even new taxes
should be levied, but the rates of taxes should not be so high as to
discourage saving, investment and production. Rather, the tax system
should provide larger incentives to those who save, invest and produce
more.

Further, to bring more revenue into the tax-net, the government

should penalise the tax evaders by imposing heavy fines. Such
measures are bound to be effective in controlling inflation. To increase
the supply of goods within the country, the government should reduce
import duties and increase export duties.

(c) Increase in Savings:
ADVERTISEMENTS:

Another measure is to increase savings on the part of the people. This

will tend to reduce disposable income with the people, and hence
personal consumption expenditure. But due to the rising cost of living,
people are not in a position to save much voluntarily.

Keynes, therefore, advocated compulsory savings or what he called

‘deferred payment’ where the saver gets his money back after some
years. For this purpose, the government should float public loans
carrying high rates of interest, start saving schemes with prize money,
or lottery for long periods, etc. It should also introduce compulsory
provident fund, provident fund-cum-pension schemes, etc. All such
measures increase savings and are likely to be effective in controlling
inflation.

(d) Surplus Budgets:
An important measure is to adopt anti-inflationary budgetary policy.
For this purpose, the government should give up deficit financing and
instead have surplus budgets. It means collecting more in revenues
and spending less.

(e) Public Debt:
ADVERTISEMENTS:

At the same time, it should stop repayment of public debt and

postpone it to some future date till inflationary pressures are
controlled within the economy. Instead, the government should
borrow more to reduce money supply with the public.

Like monetary measures, fiscal measures alone cannot help in

controlling inflation. They should be supplemented by monetary, non-
monetary and non-fiscal measures.

3. Other Measures:
The other types of measures are those which aim at increasing
aggregate supply and reducing aggregate demand directly.

(a) To Increase Production:

The following measures should be adopted to increase
production:
(i) One of the foremost measures to control inflation is to increase the
production of essential consumer goods like food, clothing, kerosene
oil, sugar, vegetable oils, etc.

(ii) If there is need, raw materials for such products may be imported
on preferential basis to increase the production of essential
commodities,

(iii) Efforts should also be made to increase productivity. For this

purpose, industrial peace should be maintained through agreements
with trade unions, binding them not to resort to strikes for some time,

(iv) The policy of rationalisation of industries should be adopted as a

long-term measure. Rationalisation increases productivity and
production of industries through the use of brain, brawn and bullion,

(v) All possible help in the form of latest technology, raw materials,
financial help, subsidies, etc. should be provided to different consumer
goods sectors to increase production.

(b) Rational Wage Policy:

Another important measure is to adopt a rational wage and income
policy. Under hyperinflation, there is a wage-price spiral. To control
this, the government should freeze wages, incomes, profits, dividends,
bonus, etc.

But such a drastic measure can only be adopted for a short period as it
is likely to antagonise both workers and industrialists. Therefore, the
best course is to link increase in wages to increase in productivity. This
will have a dual effect. It will control wages and at the same time
increase productivity, and hence raise production of goods in the
economy.

(c) Price Control:

Price control and rationing is another measure of direct control to
check inflation. Price control means fixing an upper limit for the prices
of essential consumer goods. They are the maximum prices fixed by
law and anybody charging more than these prices is punished by law.
But it is difficult to administer price control.

(d) Rationing:
Rationing aims at distributing consumption of scarce goods so as to
make them available to a large number of consumers. It is applied to
essential consumer goods such as wheat, rice, sugar, kerosene oil, etc.
It is meant to stabilise the prices of necessaries and assure distributive
justice. But it is very inconvenient for consumers because it leads to
queues, artificial shortages, corruption and black marketing. Keynes
did not favour rationing for it “involves a great deal of waste, both of
resources and of employment.”

Inflation
 Inflation is a situation of rising prices in the economy.
 A more exact definition of inflation is a sustained increase in the
general price level in an economy. Inflation means an increase in the
cost of living as the price of goods and services rise.
 The rate of inflation measures the annual percentage change in the
general price level.
Inflation and value of money
 Inflation leads to a decline in the value of money.  “Inflation means that
your money won’t buy as much today as you could  yesterday.”
 If the prices of goods rise. the same amount of money will purchase a
smaller quantity of goods.
 This diagram shows how inflation in the US has eroded the purchasing
power of the dollar. The biggest decline in the purchasing power of the dollar
occurred in the 1970s when inflation was highest.

Purchasing power of the Pound Sterling  (1920=100)

1920 1930 1940 1950 1960 1970 1980 1990 1998

100 125 129 98 66 46 133 6.8 5.33

This table shows us that £100 buys fewer goods in 1998 than 1920, (approx
78% of its value)

Types of inflation

 Cost-push inflation – when a rise in prices is caused by a rise in the cost

of production, such as higher oil prices
  Demand-pull inflation – when a rise in prices is caused by rising
aggregate demand and firms pushing up prices due to the shortage of
goods
Definition Hyper-Inflation

Hyperinflation is generally considered to occur when inflation is greater than

1000%. With hyperinflation, money loses its value so rapidly that nobody
wants to use it as a medium of exchange.
In 1920s Germany had inflation of 100 billion %
In 1946 Hungary had inflation of 42,000 billion per cent

See: Hyperinflation

Graph showing UK inflation rate

UK inflation in the post-war period.

 In 1974, the inflation rate peaked at 25%. This was due to rising oil
prices and rising wages.
 In the late 1990s and early 2000s, the inflation rate fell to less than 2%
in 2004.
 This fall in the inflation rate means prices were increasing at a slower
rate.
UK Inflation since 2000

 Inflation was close to the governments target of 2% between 2000-

2007
 In 2008, inflation peaked at 5%, primarily because of a surge in the
price of oil.
 Inflation fell in 2009, because of the recession and fall in demand.
 In mid-2015, there was a short period of deflation (negative inflation
rate – falling prices)
Definition of Deflation

Deflation is a fall in the price level of the economy. It means there will be a
negative inflation rate.

See more on deflation

Measuring inflation

To calculate inflation, the statistics authority (ONS)

  Measure the price of 1,000 goods every month
 Gives a weighting to different goods depending on how important they
are in a typical basket of goods.
 An index is created with calculates the weighting of good * price
change.
See more on Measuring inflation
Costs of inflation

Inflation is seen to have economic costs. These include:

1. A decline in value of savings

2. Uncertainty for business leading to less investment.
3. A decline in the competitiveness of exports (if inflation higher than in
other countries.)
See also: Costs of inflation
Causes of inflation

Inflation can be caused by:

1. Excess demand. Rapid economic growth causes firms to put up prices

2. Rising costs. For example, rising price of oil/commodities causes rise in
price of goods.
Repo Rate and reverse repo rate to control money supply

Repo rate is the rate at which the central bank of a country (Reserve Bank of India in case
of India) lends money to commercial banks in the event of any shortfall of funds. Repo
rate is used by monetary authorities to control inflation.

1. RBI increases repo rate:

In order to control excess money supply and inflation in the economy, central bank
increases repo rate and lends to commercial banks at a higher rate. Now, because of
increased repo rate, funds come to commercial banks at a higher cost, so in order to cover
those increased costs of acquiring funds, commercial banks increase their lending rates for
loans and advances. Since, lending rates are increased, people abstain from borrowing and
postpone their purchases thereby decreasing demand for products and services,
consequently it leads to decrease in money supply in economy and decrease in inflation
rate.

2. RBI decreases repo rate:

In order to cure depression and lack of effective demand, central bank decreases repo rates
and lends to commercial banks at a reduced rate. Because of reduced rates, commercial
banks can acquire funds at a lower cost and in order to acquire new consumers and markets
they pass their benefit of lower cost to consumers by decreasing their prime lending rates
on loans and advances. Since, lending rates are reduced by banks, credit is cheap and this
induces people to venture in new business activities and purchase of capital goods leading
to increased demand for capital goods and increased employment rates.

Reverse Repo Rate is the rate at which the Central Bank borrows money from the
commercial banks. (RBI borrows only to control money supply, not that RBI is facing a tight
budget!).

Increase in R Repo Rate:

So, when the RBI offers a nice interest rate, the banks happily lend to RBI.

 This reduces the excess cash reserves of comm banks.

 When their reserves decrease, banks would be able to lend less credit, hence
credit creation and money supply decreases.
Decrease in R Repo Rate:

Low interest rates are unattractive to banks, banks reduce lending to RBI, and lend to other
sectors offering better rates of interest.

 More cash reserves remain with comm banks.

 They can lend more loans to public.
  Increases the money supply and credit availability in economy.

What are the securities commonly dealt with by icici

ICICIdirect.com is a part of ICICI Securities and offers retail trading and investment

services. ICICIDirect in association with ICICI Bank offer wide spectrum of financial
product and services under one account. Their product line consist of Online Equity
Trading, Derivatives Trading, Mutual Fund & IPO, Fixed Deposit, Bond, NCD, wealth
products, Home Loans, Loan against Securities, life and general
Insurance. ICICIdirect.com also offers access to comprehensive research information,
stock picks and mutual fund recommendations among other offerings.
Group Companies of ICICI:

 ICICI Bank
 ICICI Securities
 ICICI Lombard general Insurance
 ICICI Prudential Life Insurance
 ICICI Prudential AMC
 ICICI Home Search
Key Products and Services of ICICI Securities (www.icicidirect.com) are:
ICICI 3-in-1 Account
ICICI offers 3-in-1 account for the most convenient way to invest in share market
in India. The 3-in-1 account is combination of "ICICI Bank saving
account", "ICICIDirect demat and trading account" opened and linked together
for seamless transactions between these accounts.
Opening 3-in-1 account with ICICI is compulsory. You cannot link any other bank
account with your ICICIDirect trading account.
The 3-in-1 account opening charges is Rs 975. Minimum balance of Rs 5000
(Monthly Average Balance) is required with ICICI Bank Saving Account linked with
3-in-1 account.
ICICIDirect Equity Trading
ICICIDirect is registered member of NSE and BSE, you can trade in Equity Cash
and Equity Intraday using margin facility with online or offline (branch / sub
brokers) network. ICICIDirect have competative trading charges for equity
delivery and intraday. ICICIDirect also offer Equity SIP facility, so you can do your
planned investment vis ICICIDirect SIP.
ICICIDirect Margin and Margin Plus
This is a facility provided by ICICIDirect to its clients where you can do an intra-
settlement trading upto 3 to 4 times of available funds using MARGIN.
Through ICICIDirect MarginPLUS you can do an intra-settlement trading up to 25
times your available funds, wherein you take long buy/ short sell positions in
stocks with the intention of squaring off the position within the same day
settlement cycle. Via Bullet plan, you will get up to 200x margin i.e with Rs 1000,
you can trade value of Rs 200000, you need to square off your position in 5
minutes to get Zero Brokerage service.
ICICIDirect Market and Limit Order
You can trade by placing market orders during market hours that allows you to
trade at the best obtainable price in the market at the time of execution of the
order.
Limit order allows you to place a buy/sell order at a price defined by you. The
execution can happen at a price more favorable than the price defined by you.
Limit orders can be placed during holidays & non market hours too.
ICICIDirect Derivative Trading
Through ICICIdirect.com, you can trade in index and stock futures on the NSE. By
paying lesser amount of premium, you can create positions under OPTIONS.
ICICIdirect f&o brokerage has different plan and depend on volume, so the higher
your volume is the lower you pay brokerage.
ICICIDirect Currency Trading
ICICI Direct offers you a simple and convenient way to trade and hedge your
currency risk in four pair of Currencies- Dollar, Euro, Pound and Japanese Yen
against Indian Rupee. If the Currency Segment section is not enabled either you
have not opted for the facility or may not be KYC (Know-Your-Customer)
Compliant.Check with the Broker.
ICICIDirect Mutual Fund Investment
With ICICI Bank or ICICI Direct you can invest in over 2000 mutual funds whom
they partner with. You can pick the mutual funds based on research done by ICICI
research team. Investment is simple and paperless using ICICI’s online portal. You
get facilities like making a lump sum investment, redemption, switches within
same funds, setting up systematic investment plans etc.ICICIDirect SIP,
ICICIDirect STP, and ICICIDirect Mutual Fund investment is completely Free.
There are Zero Brokerage for Mutual Fund Investment. ICICIDirect do not have
Direct Mutual Fund Investment options. ICICI Mutual Fund account opening is
completely paperless. You dont need deamt and Trading account to invest in
Mutual Funds with ICICI. You must have ICICI bank account. With the
netbanking, you can start Mutual Fund investment by your own.
ICICIDirect IPO Investment
Since ICICI Direct is a part of ICICI bank, you can invest in IPO using your ICICI
Bank account directly. After ASBA rule, you can invest in IPO only with Banks or
3-in-1 account, so you can invest in IPO from ICICI bank site or ICICI Direct
website. Either fill the paper form and submit to ICICI branch in your city or fill
the online form from bank account.
ICICI Bonds and FDs investment
ICICI direct offer a range of Corporate Fixed Deposits varying in tenures, interest
rates & institutions to suit your investment needs.
ICICI Direct also offer investing in bonds that refers to a security issued by a
company, financial institution or government offering regular or fixed payment of
interest in return on the amount borrowed for a certain period of time.
ICICI ETF Investment
Exchange Traded Funds or ETFs are securities that are traded, like individual
stocks, on an exchange and one must pay a brokerage to buy and sell ETF
units.You can buy and sell Gold, Index, Banking or International ETFs online
through your ICICI direct account.
Loan Against Securities
ICICI direct acts as a referral agent of ICICI Bank in providing loans against
securities given by way of a current account against pledge of securities that you
hold.
ICICIDirect Demat Account
ICICI offer demat services through ICICI Bank. They are DP with NSDL and CDSL.
ICICI Bank offer demat services to avail fast and paper less transaction. Having
demat account with ICICI is compulsory. ICICIDirect Demat Account is one of
the best bank to open demat account in India.

o ICICI Demat Account opening charges : Nil

o ICICI Demat Account Maintenance Charges (AMC) : Rs 700
ICICIDirect Research Services
ICICIDirect has an independent equity research team that provides strong and
timely updates to ensure that customer can avail of market opportunities. ICICI
provide research offerings like Detailed Company Report, Pick of the Week,
Model Portfolio, Stock on the Move, Daily & Weekly derivatives, Intra-day calls,
Daily, Weekly & Monthly Technical with a regular update on the performance of
calls.ICICIDirect equity research reports has won many awards in research report
category.
ICICIdirect Active Trader Service (ATS)
The Active Trader Service is an innovative offering from ICICI Securities for active
traders. If you activate this service with ICICIdirect, then you will be assigned a
dedicated relationship manager and a special research team who is focused on
helping you achieves your targets. You can avail research in terms of Positional
Calls, Technical Picks, Momentum Picks, Roll-over Monitor, Open Interest Insight,
Special Situation Arbitrage, Pair Calls etc.
ICICIDirect equity Advisory Group
The Equity Advisory Group (EAG) is a team of advisors dedicated to providing
customers personalized advisory services.
A Personal Equity Advisor will closely monitor the client's portfolio and keep him
updated on the latest happenings in equity market with the help of fundamental
and technical research.
ICICI Wealth management services
The Wealth Management Group is a team of specialists who offer specific
advisory services to meet both personal and business wealth requirements of
HNIs.
The team creates customized strategies to meet Customer's investment goals of
wealth accumulation, wealth preservation and liquidity.
ICICIDirect Portfolio Tracker
ICICI’s portfolio tracker and watch-list along with sms alerts will keep you
updated on the status of your investments and act on them when required.
ICICIDirect Price Improvement Order
With Price Improvement Order, if you wish to buy a stock and stock price keeps
falling, your price improvement order prices will trail downwards ad execute order
only when the stock startes to rebound. With this you will get better prices in
volatile markets. This order can be apply for both buy and sell side.
ICICIDirect GTC Order and ICICIDirect VTC Order
ICICIDirect GTC is short form of 'Good Till Cancel'. My GTC Orders is a unique
and a very useful feature offered by ICICIDirect. Using this facility, when placing a
buy/sell order, a share trader can specify the date until when the order will be
valid. ICICIDirect VTC order are "Valid Till Cancel" orders which can be placed for
specific order to meet specific order alerts.
ICICIDirect NRI Services
ICICIDirect offer NRI account by 3-in-1 integrated account that enables you to tie
in your savings bank, demat and brokerage accounts electronically and seamlessly.
You can invest in equities, derivatives (F&O), mutual funds, IPOs, ETFs through
your ICICIDirect NRI account. ICICIDirect NRI brokerage rates are bit higher, but
you get full service with ICICIDirect NRI account.
 ICICIDirect Virtual Trading
ICICIDirect Virtual Trading allows you to learn trading without investing any real
fund.Virtual Stocks is a learning tool provided by ICICI Securities (I-Sec) for stock
investing through simulated trading platform using virtual money. It is a very easy
process. - click on virtual trading link, provide your email id, code varification and
you will get password on your email. With that you will get virtual money worth
of Rs 15 Lakh for Equity and 25 Lakh for Derivative Trading. You can check your
profit and loss statement and track your portfolio.

Securities
A simple definition of a security is any proof of ownership or debt that has been assigned a
value and may be sold. (Today, evidence of ownership is likely to be a computer file, while
once it was a written piece of paper.) For the holder, a security represents an investment as
an owner, creditor or rights to ownership on which the person hopes to gain profit. Examples
are stocks, bonds and options.

ICICI Securities
ICICI Securities Ltd is an integrated securities firm offering a wide range of services including
investment banking, institutional broking, retail broking, private wealth management, and financial
product distribution.

ICICI Securities sees its role as 'Creating Informed Access to the Wealth of the Nation' for its
diversified set of client that include corporates, financial institutions, high net-worth individuals
and retail investors.

Headquartered in Mumbai, ICICI Securities operates out of 66 cities and towns in India and global
offices in Singapore and New York.

ICICI Securities Inc., the stepdown wholly owned US subsidiary of the company is a member of
the Financial Industry Regulatory Authority (FINRA) / Securities Investors Protection Corporation
(SIPC). ICICI Securities Inc. activities include Dealing in Securities and Corporate Advisory
Services in the United States. ICICI Securities Inc. is also registered with the Monetary Authority
of Singapore (MAS) and operates a branch office in Singapore

Features:
 Easy access: A Demat Account can give quick & easy access to your investments and
statements through net banking. Also, these details can be available to you anywhere – computer,
smartphone or any other smart device.
 Easy dematerialization of securities: If an investor holds certificates in physical form, he/she
only needs to give instructions to the depository participant (DP) to convert it in an electronic form.
Similarly, certificates in electronic form can be converted into physical form on request, if needed.
 Receiving stock dividends & benefits: Demat Accounts have replaced the time-consuming
process with quick & easy methods to receive dividends, interest or refunds. It is all auto-credited in
the account. It is also extremely convenient when it comes to updating investors’ accounts with stock
splits, bonus issues, rights, public issues, etc. through electronic clearing service (ECS).
 Easy Share transfers: Transfer of shares on buying or selling have also become much
easier. Earlier physical transfer of shares would take about 1 month time or so. With this process
 simplified, costs have also come down. There is no stamp duty on transfer of securities held in the
electronic form.
 Liquidity of shares: Demat Accounts have made it simpler, faster and convenient to get
money on selling shares.
 Loan against securities: As a Demat Account holder, you can avail a loan against the
securities held in your Demat Account.
 Freezing Demat Account: Specific type or quantity of securities in a Demat Account can be
frozen by the Demat Account holder. He/she can also choose to freeze the Demat Account for a
certain period of time. This will stop the transfer of money of any Debit or Credit Cards into the
particular Demat Account.
 Globalizing India: Demat Accounts have played a significant part in giving foreign investors
an easy access to the Indian stock market. And rise in foreign money in the stock market has helped
the overall Indian economy in turn.

Advantages
 No Stamp duty on transfer of securities.

 Immediate and fast transfer of securities.

 Elimination of 'Bad Deliveries'.

 Elimination of risk by loss, theft, mutilation etc.

 Faster settlement and disbursement of Corporate benefits like Bonus, Rights,

Dividends etc.

 Elimination of mismatch in Bank Accounts and Address.

 Convenient Nomination facilities.

 Convenient Transmission formalities in case of death of a holder.

 No TDS deduction for demat securities.

 Demat account information and statement regularly sent to the customer.

Benefits:
 Easy and convenient way to hold securities
 Safer than paper-shares (earlier risks associated with physical certificates such as bad
delivery, fake securities, delays, thefts etc. are mostly eliminated)
 Reduced paperwork for transfer of securities
 Reduced transaction cost
 No "odd lot" problem: even one share can be sold
 Change in address recorded with a depository participant gets registered with all companies
in which investor holds securities eliminating the need to correspond with each of them
separately.
 Transmission of securities is done by the depository participant, eliminating the need for
notifying companies.
 Automatic credit into Demat account for shares arising out of bonus/split,
consolidation/merger, etc.
 A single Demat account can hold investments in both equity and debt instruments.
 Traders can work from anywhere (e.g. even from home).

What do you understand by Stock market indices?

Name the major stock market indices:-
 A stock market index is a statistical measure which shows changes taking place in the
stock market. To create an index, a few similar kinds of stocks are chosen from amongst
the securities already listed on the exchange and grouped together.
The criteria of stock selection could be the type of industry, market capitalisation or the
size of the company. The value of the stock market index is computed using values of the
underlying stocks. Any change taking place in the underlying stock prices impact the
overall value of the index. If the prices of most of the underlying securities rise, then the
index will rise and vice-versa.
In this way, a stock index reflects overall market sentiment and direction of price
movements of products in the financial, commodities or any other markets.
Some of the notable indices in India are as follows:

 a. Benchmark indices like NSE Nifty and BSE Sensex

 b. Broad-based indices like  Nifty 50 and BSE 100
 c. Indices based on market capitalization like the BSE Smallcap and BSE Midcap
 d. Sectoral indices like Nifty FMCG Index and CNX IT

NSE vs BSE
It is the oldest stock exchange marketplace not just for the India but Asia as well, which offers
high speed trading to its customers.

It is the biggest stock exchange marketplace of the India along with a front runner in the
introduction of the fully automated, electronic trading system across the country.

) NSE is the biggest stock exchange in India, while BSE is the oldest stock
exchange in India.
2) The BSE was established in 1875, while the NSE was Established in 1992.
3) The benchmark index for the NSE is the Nifty, while for the BSE it is
Sensex.
4) Global Rank is 11th and 10th
5) BSE promotes trading in equity, debt instruments, mutual funds,
currencies, derivatives, while NSE promotes trading equity, equity derivatives,
debt and currency derivatives segments.
6) The vision of BSE is to 'Emerge as the premier Indian Stock Exchange with
best - in - class global practice in technology, products innovation and
customer service', while NSE's vision is to 'Continue to be a leader, establish
global presence, facilitate the financial well being of people'.
7) The BSE's Sensex comprises of 30 companies, while NSE's Nifty comprises
of 50 companies.
8) Website reference for BSE is www.bseindia.com and for NSE it is
www.nseindia.com

9) Index Value (as on October 21, 2019) for BSE is 39,298.38 and for NSE, it
stands at 11,661.85.
10) The Managing Director and CEO of BSE is Mr. Ashishkumar Chauhan and
for NSE it is Mr. Vikram Limaye.
11) The number of listed companies is 1696 for NSE and 5749 for BSE.

It is the oldest stock exchange marketplace not just for the India but Asia as well, which offers
high speed trading to its customers.

It is the biggest stock exchange marketplace of the India along with a front runner in the
introduction of the fully automated, electronic trading system across the country.

Current News ( Icici Securities )

 ICICI Securities (I-Sec), India's leading retail-led equity house, today said it has tied-up with
Sensibull, a third party derivatives strategy platform, to offer their advanced trading suggestions and
strategies on the icicidirect platform.

Sensibull is a popular tool in the equity F&O trading space and has found favour with the trading
community for easy to use interface, strategies, and analytics. The platform suggests a list of
strategies based on a trader's market view and provides all essential information like trade, strike
prices, risk, profit and loss potential etc. One can also compare different Option strategies to find the
right one. Sensibull attempts to create possible scenarios for investors so that they can take best
decision while placing bets. Currently it has over 50,000 unique weekly logins.

"With the rise in F&O trading, it is imperative that investors look for differentiated tools to enhance
and validate their trading strategies. In this context we are confident that our customers will find
Sensibull's offerings very useful. The new regulation on derivative margin effective June 1 st will
encourage traders to execute multi leg positions to save margin and hedge against the volatility.
Sensibull will give an edge to our customers in terms of determining the most suitable strategy for
them in terms of risk reward and ROI on margin. We are looking at more such niche tie-ups to
further augment the overall trading experience on icicidirect," said Mr. Kedar Deshpande, Head -
Retail Distribution, Product & Services, ICICI Securities.

Business:
Equity Capital Market :

ICICI Securities has been providing Capital Markets Advisory for several
years and has also been involved in most of the major public equity issuances
in recent times. For the period from April 1st, 2012 to September 30th, 2017 we
were the leading investment bank in the Indian Equity Capital Markets by
number of primary issuances managed. ICICI Securities provides end-to-end
fund raising solutions from structuring to placement of the equity instrument.
The firm's expertise includes managing initial public offerings (IPOs), rights
issues, share buyback, delisting, open offers and equity private placements
for our clients.

ICICI Securities has successfully managed public issues of companies which

were the first in their sector to tap the capital market such as print and
television media, Govt. of India divestment IPO, pure-play internet company in
India, mobile VAS company, etc
ICICI Securities has also been involved in various notable capital market
issuances in the Indian capital markets. The first issue of shares with
Differential Voting Rights (Tata Motors), the first IPO of an Indian
infrastructure of toll road assets (IRB InvIT), first IPO of an Indian life
insurance company (ICICI Prudential Life Insurance Company Limited), to
name a few.

With offices across major financial centers (New York, Singapore, Mumbai
and Delhi), ICICI Securities delivers its products covering corporates and
investors across geographies.

Key Recent Deals:

During FY 2013 - H1 FY 2016, ICICI Securities has helped companies raise

~US $ 3.3 BN through IPOs, QIPs (including of NCD + Warrants) and FPOs.
(Source: Prime Database). Some of the recent transactions include:


o IPOs / OFS (SE)

o ICICI Lombard: GCBRLM, ₹ 57,000 MN

o IRB INVT: GCBRLM, ₹ 50,350 MN

o ICICI Prudential Life Insurance: GCBRLM, ₹60,570 MN

Mergers & Acquisitions:

ICICI Securities' Mergers and Acquisitions Advisory team creates and

executes solutions for clients' strategic business ambitions. The M&A team is
proficient in domestic and international transactions including acquisitions,
divestitures, joint ventures, corporate restructurings, recapitalizations, spin-
offs, mergers and exchange offers. The team also works closely with the
financials sponsors or private equity houses in India. Our knowledge of
diverse industries and regulatory framework help us innovate and tailor
products and structures to best suit the client's short- and long-term strategic
objectives.

Private Equity:

ICICI Securities has a dedicated practice to assist companies with capital

mobilization through the private equity/venture capital route across their
lifecycle. We help companies raise capital during the seed, growth and
expansion phases as well as acquisition financing & structuring the deal to
maximize value for all its stakeholders.

Our industry knowledge across multiple sectors, wide-ranging deal structuring

capabilities and thorough grasp of the regulatory environment make us the
'Banker of Choice', for companies and private equity funds alike.

We have working relationships with private equity players, both in India and
abroad and can facilitate access for our clients to these investors. We advise
on a wide variety of products including mezzanine and private equity
financing, secondary sale transactions, pre-IPO deals and preferential
allotments by listed companies.

What are BTL Activities?

Below the line activities are used to promote the product and give the much-desired hike to
stay ahead of the competition. BTL activations induce a list of activities that uses innovative
ideas to engage its audiences. In the earlier times, BTL marketing activities revolve around
direct mail campaigns, trade shows, catalogs, brand promotion activities, telemarketing, free
sampling & exhibitions.

But, in this digital era, BTL activities have taken a notch higher with out of the box ideas
and approaches to reach the target market with digitalized brand promotion activities and
search engine marketing. Instagram Hashtag Printers  and Social or Tweet Cafe are being
used extensively as a part of BTL marketing strategy to engage a larger audience base
around the globe.

BTL marketing activities allow brands to connect with their customers on an emotional
level. It allows customers and brands to know each other in a more refined way while giving
exposure and loyal customers to a brand.

Benefits of using BTL Activations

Experiential marketing solutions are a top priority for digital marketers to gain the attention
of the masses and create two-way communication. BTL activation boosts the marketing
game for any brand as it has many benefits associated with it. You must be thinking about
how BTL activities can give a boost to your brand? Let’s discuss some of the benefits of
BTL activations and experiential technology  that will speed up your marketing game and
make you the known name while leaving your competition behind.

1. Below the line activities creates a direct point of contact between customers and brands,
helping them to understand each other in a better way.
2. BTL activities create brand awareness while attracting more customers, resulting in more
sales leads.
3. Below the line activations help in reaching your target audience with much ease as
compared to traditional ways of marketing.
4. BTL activities give an advantage to your brand by marking its presence. It makes your brand
stand out while saving it from getting lost in the clutter.
5. Below the line activations help in building a positive image of a brand with instant results.
6. BTL activities make the brand memorable and remarkable. It creates an impact on the
audience with its dynamic strategies.
7. BTL marketing activities allow audiences to get the insight of a product. It allows the
audience to feel the product if sampling is taken as one of the measures in BTL activations.
8. BTL activities help in getting valuable feedback from the customer which helps in
improving the product or service.
As time has changed so does BTL marketing activities. Traditional ways of BTL marketing
are followed by every other brand, resulting in no gain no loss situation. As the scenario is
moving more towards digitalization, new experiential technology ideas for brand & event
promotion  has come into existence.

Innovative and out of the box social media strategies  are needed in the current scenario, to
create a buzz around social media. Let’s have a look at some new ideas in BTL activations
which will boost your marketing game.

Best Ideas for BTL Brand Activations

Photo Booths
Photo Booths for events  are creating noise in this current scenario with its presence in every
event. To promote any event whether is corporate or personal photo booths have been the
right choice. A little digitalization in photo booths for the social bees catches the audience’s
attention quite easily. It allows them to enjoy while gaining all the social attention. Photo
booths allow attendees of an event to get clicked by following the instructions on the touch
screen. It allows the user to add some filters and layouts from the section. Uploading an
image with an event hashtag instantly gives you the print of your picture while letting your
event trend on the social platforms. Here is a complete guide to all kind of photo booths .

Tweets Cafe or Social Cafe

Who doesn’t like surprise gifts? I think no one out there says no to it. Tweet cafe or Social
cafe can make your event a trendsetter on social media platforms while throwing the
spotlight on your brand.
It is a perfect way to garner more audience by offering surprise gifts. A simple tweet with an
event hashtag and a specific box number make your brand campaign reach many active
users while evoking them to be the part of the same, resulting in more brand reach without
any geographical boundaries.

Tweet cafe  has its significance in experiential marketing solutions, that will make a brand
campaign make a buzz on social platforms.

Social Photo Mosaic Wall

The social mosaic wall is one of the effective ways to trend your event on social media.
Smartphones always stay in the scene. Attendees at your event tend to capture images at an
entire event. All the photographs captured at an event can be displayed at a photo mosaic
wall which will summarize the whole event to the attendees if they have missed something.  
You can enjoy a digital album of an event without even asking for the photographs. Just
follow live updates or use event hashtags to gather pictures from your event across social
media platforms.

3D Holographic

3D Hologram fan create a sense of fun and excitement. A 3D hologram can be seen without
wearing 3D glasses. An event that uses 3D holographic as its BTL activity becomes the talk
of the town in no time while setting a trend for other brand events to follow the same. 3D
holographic is a unique experiential technology solution that allows brands to highlight their
product in a most innovative way and allow attendees at the event to get clicked with it. Let
your event shout aloud with its remarkable presence and out of the box approach to garner
audience attention.

BTL activities have marked its significance in the marketing trends and are now used by
every other brand to win over the competition.

Let your brand gain more sights and generate more sales through BTL activities. Speed up
your marketing game with the latest trends and ideas in BTL marketing activities with the
help of an experienced brand activation agency . It’s time to reach your untapped audiences
in the most innovative ways.
Role
- BTL Activities, Event execution and results tracking
- Managing Marketing projects that will in turn roll like NPS, Demat account,
etc.
-   Alliances/ cross-promotion
-  Support for activities in Corporate, Societies, etc
-  Support on Campaign & Activations
-  Vendor Relationship Management
-  Audit/certification of all Marketing jobs done
-  End to End ownership for BTL campaigns, Marketing activations and Brand
compliance for ICICIdirect
-  Drive BTL activities in the assigned region for NCA, Cross-sell/Upsell.

Cross Selling & Up selling:-

What is cross-selling?

Cross-selling is the technique of selling an additional product or service to an existing

customer. Cross-selling can be either used to increase the sales and to maintain the
relationship with customer by giving them the product with the similar choices and engage
them to your website.

In cross-selling, there is always a risk involved that is it can disrupt the relationship with the
existing customers. For that reason, it is important to ensure that the additional product or
service being sold to the customer enhances the value the customers get from the
organization.

What is upselling?

Upselling is a sales technique where a seller offers the customers to purchase a more
expensive product, a higher quality product of the current product or service in order to
make a more profitable sale.

Usually, every large business combines cross-selling and up-selling techniques to increase
revenue and to increase customer satisfaction.

The benefits you get from upselling and cross-selling

 Increases the sales and revenue

 Simple to differentiate between loyal and occasional customers
 Increases customer satisfaction
  Converts lead into customers
 Improves conversion rates

BASIS FOR
RIGHT SHARES BONUS SHARES
COMPARISON

Meaning Right shares are the one
available to the existing
shareholders equivalent to
their holdings, that can be
bought at a fixed price, for
a definite period of time.
Bonus shares refers to the
shares issued by the
company free of cost to the
existing shareholders in the
proportion of their holdings,
out of accumulated profits
and reserves.

Price Issued at discounted prices Issued free of cost

Objective To raise fresh capital for To bring the market price

the firm. per share, within a more
popular range.

Renunciation Shareholders may fully or No such renunciation

partly renounce their
rights.

Paid up value Either fully or partly paid Always fully paid up.
up.

Minimum Mandatory Not required

subscription

Save On Taxes
 BASIS FOR
EQUITY SHARES PREFERENCE SHARES
COMPARISON

Meaning Equity shares are the Preference shares are the shares
ordinary shares of the that carry preferential rights on
company representing the matters of payment of
the part ownership of dividend and repayment of
the shareholder in the capital.
company.

Payment of The dividend is paid Priority in payment of dividend

dividend after the payment of over equity shareholders.
all liabilities.

Repayment of In the event of In the event of winding up of the

capital winding up of the company, preference shares are
company, equity repaid before equity shares.
shares are repaid at
the end.

Rate of dividend Fluctuating Fixed

Redemption No Yes

Voting rights Equity shares carry Normally, preference shares do

voting rights. not carry voting rights. However,
in special circumstances, they
get voting rights.

Convertibility Equity shares can Preference shares can be

never be converted. converted into equity shares.

Arrears of Equity shareholders Preference shareholders

Dividend have no rights to get generally get the arrears of
arrears of the dividend dividend along with the present
for the previous years. year's dividend, if not paid in the
 BASIS FOR
EQUITY SHARES PREFERENCE SHARES
COMPARISON

last previous year, except in the

case of non-cumulative
preference shares.

The National Pension Scheme is a pre-defined contribution pension system which is

operated by the government of India. Before 2004, NPS used the defined benefit plan,
wherein the benefits available to the pensioner post retirement were pre-defined.

Apart from offering a range of investment options to employees, the scheme allows
individuals to make decisions about where their pension fund is invested, permits limited
withdrawal prior to retirement and reduces the total pension liabilities of the Government of
India.

NPS has two main categories:

Tier I – A Tier I account is a basic retirement pension account available to all citizens from 1
May 2009. Although in case of Premature Withdrawal, one can withdraw only up to 20%
after a lock-in period of 10 years and the remaining has to be invested in an Annuity.

It has a minimum contribution of Rs. 6,000 per annum or Rs. 500 per month. Although it has
no maximum investment limit, one can get a Tax Exemption of up to Rs. 1.5 Lac per annum
as per section 80C and an additional Rs. 50,000 as per section 80CCD.

Post attaining the age of 60, maximum 60% amount can be withdrawn and remaining, 40%,
needs to be invested in Annuity.

Tier II – A Tier II account is a Prospective Payment System (PPS) account that permits some
withdrawal of pension prior to retirement under exceptional circumstances, usually related
to the provision of health care.

It has a minimum contribution of Rs. 2,000 per annum and no maximum contribution limit.
However one does not get any tax benefit under this category.

There is no lockin period given that there are NO Tax Benefits.

Benefits of NPS (Tier I)

NPS has 2 major benefits such as –

1. Tax Benefit upto 1.5 Lac under section 80C and Rs. 50,000 under section 80CCD.
 2. 2. The returns earned from this scheme is better than various other tax saving
products in case of Auto Choice. In case of Active Choice, the composition of the
portfolio matters.
Besides these 2 factors, it instills a practice of regularly saving for retirement.

Risks of NPS (Tier I)

NPS has certain risks involved as well, such as –

1. Once a person has started investing in an NPS, he has to make the minimum
contributions every year and can withdraw only 25% after 10 years for specific
purposes including children's higher education or marriage, construction or
purchase of first house and medical treatment of self, spouse, children or
dependent parents.
2. There is a minimum contribution of Rs. 6,000 per annum and only maximum of
50% can be allocated to equities.
3. 3. As of now NPS is EET (Exempt, Exempt, Taxed) which implies that the
investment and returns won’t be taxed but the redemption amount would be
taxed as per the eligible tax slab.
Taxation

In Budget 2016-17, the government rationalized the tax on NPS to make it more attractive.
NPS has EET status which means that the investment and returns are not taxable, however a
tax will be levy on the redemption amount.Since minimum 40% of the corpus has to be
invested to buy an annuity, the taxation on the 40% of the corpus get delayed. In addition,
now a person can withdraw up to 40% of the corpus without paying any tax. Therefore, only
20% of the corpus will be taxed.

Example

Let’s say someone has an NPS corpus of Rs. 1 crore at retirement. The following two this will
happen to him:

 He has to buy an annuity of the 40% of the corpus i.e. Rs. 40 Lac goes to
annuity.
 He can withdrawal the rest Rs 60 lakh of the corpus, out of which Rs. 40 lakh is
tax free while Rs 20 lakh is taxable as per the income slab of the investor.
How can I withdraw from an NPS account ?

The government has strict regulation on the withdrawal of NPS corpus. Hence you can
withdraw from an NPS account in the event of retirement or achieving the age of 60. Post
achieving the age of 60, you can withdraw maximum 60% of the corpus and the rest has to
be invested in an annuity.

In case of an emergency you can withdraw up to 25% of the contribution amount for
specific purposes including children's higher education or marriage, construction or
purchase of first house and medical treatment of self, spouse, children or dependent
parents. The medical treatment covers only 13 major illness and life threatening injuries
sustained in an accident.

An investor can withdraw 3 times during the tenure, however there has to be a gap of 5
years at least. These gaps are not applicable in case of withdrawal for medical treatments.

Ideally CRA generates an Exit Claim ID 6 months prior to an individual attaining the age of
60. However to withdraw at a later date, all you have to do is fill out the normal withdrawal
form in case of retiring or attaining the age of 60.

In case of death of the individual, the nominee will receive all the money.
Learnings from startup challenge:

Every failure is a valuable lesson

Every failure during execution will teach you a valuable lesson, no B-School can teach you all
this, these failures will make you much smarter

Teaches how to do business frugally

Startups is all about doing business with limited or meagre resources, this experience will
teach you how to operational costs without compromising on the quality

Master of all skills

Startups entail that you wear many hats, we don't have the luxury of hiring expensive
domain experts, we do our own book keeping, drafting our own legal agreements (of
course using downloaded templates), learn how to market your product (cold calling to
sales closure), involving in product coding, customer support (telephonic after sales support
to on site troubleshooting), pitching for capital .... this list is endless. Trust me at the end of
the journey you will be well versed in most of the above areas.
Essentially you will gain all the expertise which are required to run a business.

Ground realities are different

On the ground business realities are much different than what it looks like when we make
businesss plans,SWOT analysis or sales forecasting

Improved people management skills

Roping in talented people, making them work towards the organizational goal and at the
same time meeting their expectations is a major challenge.
Doing all the above will tremendously improve your people management skills.

Makes you more humane

When your startup solves real problems in society this has a very positive effect on your
personality. Your attitude towards life changes, you become humane.

You become more perseverant

Startup journey inculcates never say die attitude. Bouncing back after repeated failures is
one trait every successful entrepreneur has.

You will know who are real friends

During the startup journey, when you are down in the dumps many of the people around
you start changing colors. This is especially true in country like India where entrepreneurs
don't get the same respect as a well paid salaried guy. Most of the 'so called' friends desert
you or ignore you, the same people are again around you when you are successful.
Social stigma
In India currently there is some acceptance of the startups, but few years back situation was
different, founders of startups were ill-treated, there was a social stigma attached to
entrepreneurship, according to the majority only failures start business [their assumption is
as they could not get a good job they end up starting some business to survive :-) ]. Many
talented people who preferred to work for a startup instead of working for a blue-chip
company where a big NO in the marriage market. Thanks to the likes of Flipkart / RedBus ..
now there is more respect for entrepreneurs and many talented freshers are preferring to
work for good startups rather than work for big companies.

Sell 3-in-1 online trading account:

A Unique 3-in-1 On-line Trading Account

Seamless, Secure and Integrated 3-in-1 trading platform...

Our 3-in-1 online trading platform links your banking, trading and demat accounts, ensuring unmatched
convenience for customers.

With an ICICIdirect.com account, you get the following benefits :

Seamless Trading

You can trade in shares without going through the hassle of tracking settlement cycles, writing cheques
and transfer instructions. Absolutely hassle free!
 

Security

Instead of transferring monies to a broker's pool or towards deposits, you can manage your own demat
and bank accounts when you trade through ICICIdirect.com. It provides you the flexibility to pay only
when you trade.
 

Wide range of products

Share trading in both NSE and BSE, innovative offerings like - Margin, MarginPlus, BTST, SPOT.
Derivatives trading, overseas trading, mutual funds, IPOs and on-line life insurance.
 

Award Winning Research

We understand the need for the right research to make the right investment decision and has focused
heavily n this area. Our team with its consistent delivery has been voted as the 'Most preferred brand of
financial advisory services' at the CNBC Awaaz Consumer Awards, 2007.
 
Control

You can be rest assured, that your order will be precisely for the amount you wanted it to be, without any
deviation, giving you full control of your money and your trades.
 

Tracking and Review

Monitoring your investments is as important if not more than making that investment itself. Our portfolio
tracker and watchlist along with sms alerts will always keep you updated on the status of your
investments with us and act on them when required.

About ICICI Direct

ICICI Direct is a retail trading and investment service from ICICI Securities,
the largest retail stock broker firm in India offering a wide range of investment
options to the retail and institutional customers. ICICI Securities is part of ICICI Group,
India's top financial service provider offering banking and other financial services. ICICI
Securities offers 'online trading and investment' services to over 20 lakhs customers
through ICICI Direct (ICICIDirect.com).
ICICIDirect.com is the flagship website of ICICI Bank. This website offers a complete
suite of investment products such as Online Equity Trading, Derivatives Trading,
Mutual Fund & IPO, Fixed Deposit, Bond, NCD, wealth products, Home Loans,
Loan against Securities etc.; all under one login. ICICIdirect.com is among the most
visited investment portals in India.
The 3-in-1 account, which includes ICICI Bank Account, ICICI Trading Account and
ICICI Demat Account, is the key offering for retail stock market investors in India. It
provides extremely simple and efficient way to invest in stock market and other
financial instruments. The customers can visit any of the over 1500 ICICI Bank
branches or ICICIDirect offices to get in-person help on financial products which are
sold through ICICI direct.
ICICIDirect also offers timely pay-in and pay-out, hassle free settlements and above all
local and personalized service.
ICICIDirect Trades In: BSE and NSE

ICICI Direct Special Offers

ICICI 3-in-1 Account
ICICI Direct offers a 3-in-1 account, a combination of saving bank, trading and demat
account. It offers one-click investment in Equity, Derivatives, Mutual Funds, IPO, ETF,
Life Insurance, General Insurance, Currency, and Fixed Deposits.
Interested in opening a trading account?  Request Callback  from a stock broker.

ICICI Direct Charges 2020

ICICI Direct Account Opening Charges and AMC

Transaction Charges

Trading Account Opening Charges (One Time) ₹975

Trading Annual maintenance charges (AMC) ₹0

Demat Account Opening Charges (One Time) ₹0

Demat Account Annual Maintenance Charges AMC (Yearly ₹700

Fee)

ICICI offers 3 types of brokerage plans to its customer:

1. I-Secure Plan (Flat brokerage Plan)

This plan offers Flat Brokerage (in %) irrespective of the turnover value. This
plan is suitable for traders/investors looking at the secured and fixed brokerage.
Read more about ICICI Direct I-Secure Plan

ICICI Direct I - Secure Plan Brokerage Charges

Segment Brokerage

Equity Delivery 0.55%

Equity Intraday 0.275%

Eq Margin & Margin Plus 0.050%

Eq Future & Future Plus 0.050%

Eq Future & Future Plus (Intraday) ₹50

Currency Futures 0.050%

 Segment Brokerage

Currency Futures (Intraday) ₹10 per lot

Options & Option Plus ₹95 per lot

Options & Option Plus (Intraday) ₹50 per lot

Currency Options ₹25 per lot

Currency Options (Intraday) ₹10 per lot

NCDs / Bonds 0.75%

2. ICICI Direct Prepaid Brokerage Plan

ICICI Direct Prepaid plan offers discounted brokerage rates when you pay a one
time fixed fee upfront. There are 6 prepaid plans available. Each plan has a
validity of 15 years. Read more about ICICI Direct Prepaid Brokerage Plan

ICICI Direct Prepaid Brokerage Plan

Margin
Trading
Brokerag Brokerag Brokerag eAT Interest
Prepaid Brokerag e- e- e - Curr M Rate(yearly
Plan e - Cash Future Options Options limit )

₹10,000 0.25% 0.025% ₹35/lot 0 ₹10 12.9%

Lacs

₹25,000 0.22% 0.022% ₹30/lot 0 ₹10 12.9%

Lacs

₹50,000 0.18% 0.018% ₹25/lot 0 ₹25 11.4%

Lacs
 Margin
Trading
Brokerag Brokerag Brokerag eAT Interest
Prepaid Brokerag e- e- e - Curr M Rate(yearly
Plan e - Cash Future Options Options limit )

₹100,00 0.15% 0.015% ₹20/lot 0 ₹1 Cr 8.9%

0

₹200,00 0.12% 0.012% ₹15/lot 0 ₹1 Cr 8.9%

0

₹300,00 0.09% 0.009% ₹10/lot 0 ₹1 Cr 8.9%

0

3. ICICI Direct Prime Plan

ICICI Direct Prime plan is designed to reduce the brokerage charges and also get
money instantly in their bank account when selling shares. This plan also offers
exclusive research to members. Three prime plans - ₹900, ₹4500 and ₹9500 are
available to customers and each of these plans offers an upfront reduction in
brokerage across all equity and derivative products. All plans are valid for 365
days. Read more about ICICI Direct Prime Brokerage Plan.

ICICI Direct Prime Plan Brokerage Charges

Equity Future Currency Margin Trading

Plan Cash s Options F&O Interest Rate(yearly)

₹900 0.25% 0.025% ₹35 per ₹0 per lot 12.9%

lot

₹450 0.18% 0.018% ₹25 per ₹0 per lot 11.4%

0 lot

₹950 0.15% 0.015% ₹20 per ₹0 per lot 8.9%

0 lot

ICICI Minimum Brokerage Charges

 1. ICICI Direct Minimum Brokerage: ICICI charges minimum brokerage by the
plan you choose.
o In I-Secure plan, the minimum brokerage of ₹35 per trade or 2.5% of the
trade value whichever is lower.
o In Prime plan and Prepaid plan, the minimum brokerage of ₹25 per trade
or 2.5% of the trade value whichever is lower.
2. ICICI charges flat 5 paisa per share (₹0.05) brokerage on stocks priced less then
₹10 per share.
Visit ICICI Direct Brokerage Charges Review for more detail.
Special Offer: Get ICICI Direct 3-in-1 account, an integrated trading + demat + bank account for
one-click investment in stock market and mutual funds.  Request a Callback .

How to open account with ICICI Securities Pvt Ltd.?

For Online Stock Trading with ICICI, investor needs to open 3 accounts: ICICI Bank
Account, ICICI Direct Trading Account and ICICI Demat Account (DP Account).
Note: If you already have a bank account or demat account with ICICI, you could link it
with new ICICIDirect trading account.
Opening trading account with ICICI is easy. You could use one of the following options
to open account with ICICIDirect.

 Visit ICICIDirect.com and fill the "Open an Account" form.

 Call ICICI and tell them that you are interested in opening an account with them.
In both the cases ICICI representative contact you in a day or two and tell you about
the procedure to open the account. They usually send somebody to your home to
collect documents, signature and for demo if required.

ICICI Direct Trading Software

ICICI Direct offers 3 trading platforms to its customers:

1. ICICIDirect.com Website
ICICI Direct website is the most used online investment and trading website in
India for over 2 decades. ICICI Direct website offers online trading and demat
accounts, IPO, SIPs, mutual funds, insurance, and many other products. The
website also offers research and recommendations.

2. Trade Racer (Trading Terminal)

Trade Racer, the installable trading terminal designed for frequent traders. This
desktop online trading software is loaded with a number of tools for high-speed
volume trading. The Trade Racer terminal is offered for free to all its customers.
 3. ICICIDirect Mobile App
ICICIdirect Mobile App enables you to trade and invest on the go. Downloadable
for both Android and iOS, ICICIdirect Mobile app provides all products and
services available on ICICIdirect.com along with features like real-time price
alerts, research notifications, and customized alerts on Portfolio stocks.
 
Visit ICICI Direct Trading Software Review for more detail.

Contact ICICI Direct / Request Call Back

Get ICICI Direct 3-in-1 account, an integrated trading + demat + bank account for one-click
investment in stock market and mutual funds. Request a Callback.

Name: Phone

Email City

State

Are you a day trader? 

ICICI Direct Pros and Cons

ICICI Direct Pros (Advantages)

The following are the advantages of ICICI Direct. You must read ICICI Direct
advantages and disadvantages before opening an account with ICICI Direct. ICICI
Direct pros and cons help you find if it suits your investment needs.

1. 3-in-1 account integrates your banking, broking and demat accounts. All
accounts are from ICICI and very well integrated. This feature makes ICICI the
most interesting player in the online trading facility. There is absolutely no
manual interfere require. This is truly online trading environment.
2. Unlike most of the online trading companies in India which require transferring
money to the broker's pool or towards deposits, at ICICIDirect you can manage
your own demat and bank accounts through ICICIdirect.com. Money from selling
stock is available in ICICI bank account as soon as the ICICIDirect receive it.
3. Investment online in IPOs, Mutual Funds, GOI Bonds, and Postal Savings
Schemes all from one website. General Insurance is also available from ICICI
Lombard.
4. Trading is available in both BSE and NSE.
 5. Low bandwidth website is available for slow internet connection or for trading
from mobile devices.
6. Through VTC Feature (Valid Till Cancelled), customers can place buy or sell limit
orders which will remain valid for 45 days.

ICICI Direct Cons (Disadvantages)

The following are the cons of ICICI Direct. Check the list of ICICI Direct
drawbacks.

1. ICICIDirect brokerage is high and not negotiable. The brokerage can be brought
down by subscribing to ICICIdirect Prime or prepaid brokerage plans.
2. ICICIDirect doesn't offer commodity trading. With ICICI Trading account you
cannot trade at MCX or NCDEX. ICICI Securities have plans to introduce
commodity trading in near future.
3. ICICI minimum brokerage charge as per the standard I-Secure Plan is ₹35 per
trade which is very high for traders who does small trades.
4. ICICI charges flat ₹0.05 per share brokerage on stocks quoting upto ₹10. This
makes it very difficult to trade in penny stocks.
5. ICICI Direct charges ₹25 per call for call & trade after first 20 free calls in a
month.

ICICI Direct Margin / Exposure

ICICI Direct leverage for intraday, delivery, options, currency and commodities.

Segment Margin

Equity Delivery 5x with Interest

Equity Intraday Upto 25x

Equity Future 4x
Segment Margin

Equity Options 2x for shorting

Currency Future NA

Currency Options NA

Commodity Future NA

Commodity
Options

Visit ICICI Direct Margin Review for more detail.

ICICI Direct Ratings

Overall Rating  2.4/5

Fees  2.3/5

Brokerage  1.7/5

Usability  3.4/5

Customer Service  2.7/5

Research  3.0/5
Capabilities

Based on 422 Votes by ICICI Direct Customers

Do you trade with ICICI Direct?  Rate ICICI Direct
ICICI Direct Complaint
The number of ICICI Direct customer complaint received by the exchanges. The
ICICI Direct consumer complaint report helps understanding the ICICI Securities Pvt
Ltd. quality and relibility of service.

Exchang Financial Number of

e Year Clients* Complaints**

NSE 2020-21 1,091,830 93

NSE 2019-20 1,075,956 194

BSE 2019-20 387,968 25

NSE 2018-19 830,661 161

BSE 2018-19 250,225 25

NSE 2017-18 798,355 153

BSE 2017-18 417,147 84

NSE 2016-17 618,359 132

BSE 2016-17 296,286 21

NSE 2015-16 560,438 153

* The number of active customers reported by the broker.

** The total number of complaints received against the broker at the given exchange.

Visit ICICI Direct Complaints at BSE, NSE and MCX for detail report.

Distinguishing Features of ICICI Direct:

1. 3-1 account offers great flexibility and worry-free transaction between Bank
Account, Demat Account and Share Broker Account. Also, the website
 (ICICIDirect.com) has wide ranges of investment products available. This makes
investing easy.
2. "myGTC Orders" is a unique and a very useful feature offered by ICICIDirect.
Using this facility, when placing a buy/sell order, a share trader can specify the
date until when the order will be valid. GTC is short form of 'Good Till Cancel'.

For example - you can place an order to buy Reliance Industries shares at ₹700
(say current market price is ₹750) and keep the myGTC date, say, one month
from now. In this case, you order will be valid for next one month at ₹700. If the
share reaches at this price in next one month, the order will automatically
execute. It's a hassle-free service which helps a lot to many of the investors who
has a price in mind and do not want to miss the opportunity to buy/sell share
when it reaches to that price.