Diferrence between diect and portfolio investments?
Difference between direct and portfolio investments:
|Basis||Foreign direct investment||Portfolio investment|
|1.Meaning||Foreign direct investment, commonly known as FDI, refers to an investment made to acquire lasting or long-term interest in enterprises operating outside of the economy of the investor.||Portfolio Investment refers to the investment in the assets of a foreign country without any control over that asset.|
|2.Control||FDI lead to a complete control over the management of company.||People who have portfolio investment cannot participate in the decision making of the other company.|
|3.Example||For example, purchase of a foreign company by an Indian business group in America.||For example, purchase of shares of a company in abroad.|