What are the Differences Between Foreign Direct Investments and Foreign Portfolio Investments?
In the world of investments, terms like Foreign Direct Investment in India and FPI (Foreign Portfolio Investment) often get mixed up, creating confusion for many investors. Well, they might sound similar, but they work in different ways. Let's keep it simple and explore what sets them apart, so you can make decisions that match your financial goals. Understanding Foreign Direct Investment and Foreign Portfolio Investment FDI also known as Foreign Direct Investment means a long-term investment where a business from one country sets up shop in another country. It could be by buying assets, shares, or starting a new business there. FPI also known as Foreign Portfolio Investment, on the flip side, is a more temporary deal. Investors put their money into the financial stuff of another country, like stocks or bonds, without actively running the show. Understanding The Differences Nature of Investment: FDI: Putting money in another country for the long haul, often with a say in how thi