Cover

Story

Buying gold during

the festive season
Is it time to shift towards digital gold?
We Indians love investing in gold, especially during the festive season. Gold has been a popular investment
option across cultures & ages, for its social, emotional and economic value. In the current volatile times, gold
acts as a diversifier and an investment class, to mitigate market losses.

Here’s a quick comparison to help you choose between buying physical gold (like jewellery, coins, bullion) or
investing in Sovereign Gold Bonds.

Physical Gold Sovereign Gold Bond

Earn Only when gold appreciates 1) When the gold price appreciates
2) Interest of 2.5% per annum

Peace of Risk of theft & concern 100% safe & purity guaranteed
mind over its purity

Taxes Capital Gain tax, on sale No Capital Gain tax on redemption.

Tax Only interest earned is taxable

Additional GST +Locker/Storage No GST. Zero storage cost

charges charges

Tenure Not applicable Maturity after 8 years, with an

exit option from five and a half
years
KNOW MORE

Whether you choose to invest in physical gold or in Sovereign Gold Bonds, investing in any type of gold is
recommended, as it offers high liquidity, hedge against inflation and diversification in your portfolio.

NOVEMBER 2021 | VOL. 6

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Story

Balancing celebrations
with prudence
Festive
After nearly two years of uncertainty, it is natural to want to
Savings Spends
splurge during festive occasions. But, there are ways to
ensure that our expenses stay on track.

Shop Wisely
1. Make a shopping list:
Make a list of all that you need and shop accordingly. This will help you avoid impulse
shopping, which is very common during festive sales.

2. Stick to a budget:
Allocate a fixed amount for festive shopping. Select the gifts and other articles, such that
they fit within your budget and accordingly prepare the shopping list.

3. Look out for deals and offers:

There are offers galore during the festive season that can help
you save money. Check out the amazing offers during ICICI FESTIVE
Bank’s Festive Bonanza. BONANZA
CHECK FESTIVE BONANZA OFFERS

Use EMIs to spread out a large expense, into smaller parts

`1.2 lakh 6 EMIs of ₹20,824 each

Use EMIs for your festive shopping, so that your regular monthly investments are not affected by any large
outflows from your account.
KNOW MORE CONVERT CREDIT CARD TRANSACTIONS TO EMI

Be conscious of the investment-consumption spectrum

Pure Pure
Consumption Investment
Eating out New Home
Clothes Gold
Entertainment New SIPs, FDs, Stocks
Keep a watch on expenses that are purely for consumption and avoid over-indulgence in them.

NOVEMBER 2021 | VOL. 6

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Story

The best gift ever

that no one can take away from your kids
For a parent, the most important goal after their child’s health, is
their education. On the occasion of Children’s Day, the best gift
you can give your child, is a great education.

This requires careful planning, since quality higher education can Children’s
Day
be expensive.

Scenario 1: Higher education is 3 or more years away

Follow the below steps to build your child’s education kitty:
1 Start early and use the power of compounding, to reach your goal in time

INVEST IN SIP* OPEN AN RD OPEN A PPF ACCOUNT

2 Factor in inflation while planning. Equities have the potential to beat inflation, so you can
invest directly in Equities
START INVESTING IN EQUITIES

3
Remember that the value of money decreases with time, thanks to inflation. Analyse and
factor in the cost of education in the future, so that you know how much to save

4
Review your goal at regular intervals
Contact your Relationship Manager for the same

5 In case you want to send your child abroad for higher education, start sending money
abroad under Liberalised Remittance Scheme, to save in foreign currency and mitigate
impact of changes in forex rates

Scenario 2: Higher education is close at hand

If you need funds for higher education at a short notice, you can apply for an Education Loan. You can get a
loan without security, up to ₹40 lakh and save income tax under section 80E on the interest paid.

APPLY NOW

NOVEMBER 2021 | VOL. 6

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Story

Keep your children loved,

yet rooted
As parents, we take a great deal of effort to ensure that we teach
various skills to our children - be it sports or art or phonetics. But
most of us leave the most important life skill - 'Personal Finance
Management’ - to be learnt with experience, time and age.

Here are four interesting ways to introduce

kids to personal finance:

Importance of Saving
Providing monthly pocket money to your kids is a great way to inculcate the
habit of saving money. Let your children buy whatever they want with their
savings. Let them learn to manage their own money.

Importance of Budgeting
Allow your children to organise their birthday parties all on their
own. Hand over a specified budget to them and let them plan and
execute, with a free hand. This will teach them the art of planning
and budgeting.

Importance of Goal Setting

When your children ask for something expensive, teach them about
financial goal setting. Once a goal is set, you can add some initial amount,
but for the rest, help them pool all their resources, such as pocket money,
gifts from family and friends, etc.

Introduction to Banking
Open an ICICI Bank Young Stars Account, an iWish RD or a Pockets
wallet for your child and transfer the pocket money there. This will help
them learn about bank statements, interest income, e-wallets
and much more.

KNOW MORE ABOUT YOUNG STARS ACCOUNT OPEN IWISH GET POCKETS

NOVEMBER 2021 | VOL. 6

 FinGuru

A guide to IPOs
The last few months have seen a lot of high-profile IPOs, i.e. Initial Public Offerings being launched.
What’s more? The next few months have many prominent IPOs lined up. What better time than this, to
learn all about IPOs!

What is an IPO?
Other Public
When a privately-owned company Promoters
Private
Promoters Retail
offers its shares to the general public Investors
IPO
Investors
for the first time, it is called an IPO Public
or an Initial Public Offering. Venture
Corporate
Capitalists
Investors

Through the IPO, an unlisted company becomes listed in the stock market and its shares can be bought and
sold by the public.

When you buy a share in an IPO, you become a shareholder in the company, i.e.
you become the owner of a specific ratio of the company, based on the shares
you have invested in.

Why do companies launch their IPOs?

To dilute the ownership
To raise capital for
of venture capitalists or To pay off debts
expanding the business
other private investors

What are the advantages of investing in an IPO?

Opportunity to act early

 You can buy shares in the company before they start getting traded in the stock markets and their
prices get impacted by forces of demand and supply

Long-term benefits

 Investing in an IPO may help you get good returns in the long term, subject to market conditions

Price transparency

 The complete information about the price valuation of equity shares in an IPO is available in the
prospectus filed by the company and is available publicly
 This changes after IPO, when the price would depend on the changes in the sectorial performance
and investor interest.

NOVEMBER 2021 | VOL. 6

 FinGuru

What should one do before investing in IPO?

Do an in-depth research
 Before investing in an IPO, try to learn as much as you can about the company - its
past performance, financial records, how it fares when compared to its competitors,
press releases etc.

Look at the underwriters

 Look at the banks/brokerage firms that act as underwriters, i.e. conduct the IPO
proceedings

Go through the prospectus

 The prospectus has detailed information on the company's past financial records -
revenue, profits/ losses, debts etc.�

Be cautious
 Always be cautious when underwriters promote an IPO with claims of glowing
prospects

Consider the issue price

`
 Evaluate the price at which shares are offered. To do this, compare with the share
price of a listed company in the same line of business and of a similar scale

Don’t fall for the hype or the brand

Best  Don't invest in something just because people tell you it will do great or because it is
popular
 A reputed brand doesn't guarantee a good IPO. Don't invest in an IPO because you
think the prospects of the brand are great. Look at the records of the specific
company that is offering the shares

Ensure that you check your risk profile before investing

CHECK YOUR RISK PROFILE

NOVEMBER 2021 | VOL. 6

 FinGuru

How does one invest in an IPO?

Decide where
to invest

Wait for 1 Arrange

stock listing funds
7 2
Investing
6 in 3
Wait for share
allotment IPO Open a Demat
and Trading
to happen Account
5 4

Apply for an
Bid, as per
IPO (using
lot sizes
ASBA)

ASBA (Applications Supported by Blocked Amount) allows the bank to block the application money in the
bank account for subscribing to an issue. The application money gets debited only if application is selected
for allotment.

Process for submitting a bid through the ASBA mechanism

On allotment,
Bank blocks Bank uploads Application the relevant
Submit ASBA bank account
the application the application money is blocked
physically or is unblocked and
amount in data in the until the
electronically requisite amount
specified electronic finalisation
to the bank is transferred to
accounts bidding system of allotment
the issuer’s account

Apply for IPOs with ICICI Bank’s 3-in-1 Savings, Demat & Trading Account OPEN NOW

Know your risk profile before investing CHECK NOW

NOVEMBER 2021 | VOL. 6

 FinGuru

Herd Mentality
Herd mentality in investing is following what other investors are perceived to be doing, rather than taking
decisions based on your own objective analysis. What is touted as ‘information’ is often someone’s opinion,
which herd mentality leads you to believe as ‘facts’.
Examples of Herd Mentality
Many of your friends are buying gold and not wanting to be left out, you also buy gold
Your friends, relatives are selling mutual funds fearing market may crash further and you also
follow the same

Herd Mentality in action

Buy Low and Sell high = Success of investing in markets
Opposite happens when we make investment decisions based on Herd Mentality
Buy High
```
Herd Mentality
Share Price

``

`
Buy Low

Number of Buyers

Herd Mentality in bull & bear markets

In a bull market, you end up buying/ In a bear market, you sell/ redeem at
investing at very high prices, because very low prices because you feel what
you don't want to be left behind. others are doing is right and you don't
want to make more losses.

How can you avoid falling prey to Herd Mentality?

Invest in stocks that appear to be trading for less than their intrinsic or book value (Value Investing)

Buy and sell in contrast to the prevailing stock market sentiment (Contrarian Investing )

Have a disciplined approach in investing, i.e. invest as per your risk profile, make a financial plan
and stick to it, irrespective of market movements
KNOW YOUR RISK PROFILE

For any assistance, contact your Relationship Manager or reach out to your nearest ICICI Bank branch
NOVEMBER 2021 | VOL. 6
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Story

Warm wishes
of the festive season!
As we celebrate the festival of lights, let us apply the dos and don’ts
of celebrations in our finances as well.

Take care of risks:

Just like we take care to not wear loose or flowing clothes near lighted
lamps, let us also invest with care after evaluating and understanding risks.

Add a personal touch:

We put a great deal of thought in choosing just the right gifts for our loved
ones. Similarly, let us choose the right investments based on our age,
goals, investment tenure and risk appetite

Do a thorough clean up:

Just before the festive season, we embark on a cleanliness campaign at
home, and dispose goods that we no longer require. In the same manner, we
can review our investments and get rid of those that no longer meet our
goals.

Dispel the darkness:

We light lamps to banish darkness. Similarly, let us use the light of
knowledge to dispel the darkness of lack of information about finances and
investments.

We wish you and your loved ones health,

wealth, happiness and peace.

NOVEMBER 2021 | VOL. 6

 Safe
Banking

Safe Banking tips to

safeguard festive joy
November 14-20, 2021 is International Fraud Awareness Week. Let us follow the below safe
banking tips so that we secure ourselves against frauds and safeguard the spirit of cheer and
celebration .

` Send and Receive Money Safely

Always remember that to receive money there is no need to enter your PIN/ Password,
anywhere

Never scan a QR code for receiving payments

If the UPI or any other app asks you to enter your PIN to complete a transaction, it
means you will end up sending money, instead of receiving it

Do not transfer funds, without knowing whom you are transferring it to. Ensure due
diligence

x Sharing is not always Caring

Never share your UPI wallet PIN, card details like PIN, One-Time Password (OTP),
CVV, expiry date, grid value, types of card (Visa, Master, Rupay etc.) with anyone, even if
the person claims to be from a bank

Bank officials/financial institutions/any genuine entity never asks the customer to share
their confidential information, such as Username/Password/Card details/CVV/OTP

Do not download or activate the screen share feature, with unknown people

Stay safe online

Never download any application from unverified/unknown sources

One should not click on unknown links, and should delete the SMS/e-mail immediately,
to avoid accessing them in the future. Care should be taken to verify the website details,
especially where it requires entering your financial credentials

NOVEMBER 2021 | VOL. 6

 It’s time to test your knowledge. Take a short
and simple quiz, based on what we have
covered in The Orange Book, so far.

TEST YOUR KNOWLEDGE

Do you have any doubts or questions about

personal finance? Ask us!
E-mail us at theorangebook@icicibank.com,
from your registered email address.
We will answer as many questions as possible,
in the next volume of The Orange Book.

We hope you liked going through

We would really appreciate your feedback.

CLICK HERE

to share your feedback and suggestions.

Thank you.
*ICICI Bank Limited is a AMFI Registered Mutual Fund Distributor. Mutual Fund investments are subject to market risk. Read all
scheme related documents carefully. T&C Apply.

Please click here for disclaimer

NOVEMBER 2021 | VOL. 6