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Sonali posted an Question
October 10, 2020 • 21:19 pm 20 points
  • UGC NET
  • Commerce

Difference between fpi and fii

what is difference between foreign portfolio investment and foreign institutinal investment

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  • Rucha rajesh shingvekar

    https://www.angelbroking.com/knowledge-center/share-market/fpi-vs-fii

  • Rucha rajesh shingvekar

    Foreign Portfolio Investment (FPI) is similar to FDI in a way that this is also direct investment but investment in only financial assets such as stocks, bonds etc. of a company located in another country. ... Foreign Institutional Investor (FII) is an investor of group of investors who bring FPIs.

  • Priya gulani

    Foreign Portfolio Investment (FPI) means  investing in the financial assets of a foreign country, such as stocks or bonds available on an exchange. This kind of investment is considered less favourable than direct investment because portfolio investment can be sold off quickly and these are at times seen as short term attempts to make money, rather than a long-term investment in the economy. A few examples of FPI are investments made in the shares of a foreign country. Another example is investment by purchasing the bonds floated by  a foreign government. Unlike FDI, FPI doesn’t offer control over the business entity in which the investment is made. FII Foreign Institutional Investors (FIIs) are large companies that invest in countries other than where their headquarters are located. The term FII is most commonly used in India, where it refers to outside entities investing in the nation’s financial markets. However, this term is also used officially in China. FIIs can include hedge funds, insurance companies, pension funds, investment banks and mutual funds. FII is an important source of capital in developing economies. Yet, countries like India have placed limits on the total value of assets an FII can purchase and the number of equity shares it can buy, particularly in a single company. This helps limit the influence of FII on individual companies and the nation’s financial markets. Examples of FIIs are pension funds, mutual funds, investment trusts, insurance or reinsurance companies, trustees, banks, endowment funds.

  • Priya gulani best-answer

    FDI- Foreign Direct Investment- foreigners who have a long term view of the prospects of Indian economy and therefore establish business here or partnership in India through long term investments like equity capital, compulsorily convertible securities etc. FII-Foreign Instituutional Investirs are those Instituutions/ mutual funds pension funds etc. registered abroad who have a medium term view of India to invest in the instruments there. FPI- Foreign Portfolio Investors are those having short term view for making profits by getting in and getting out of the investment instruments through stock markets.

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