FPI

• Foreign Portfolio Investment (FPI) means investing in the financial assets of a foreign country, such as stocks or bonds available on an exchange. 
• It does not provide the investor with direct ownership of a company’s assets.
• FPI is often referred to as “hot money” because of its tendency to flee at the first signs of trouble in an economy. 

How is it different from FDI? 

• Foreign Direct Investment (FDI) is the investment made by a person or a company in one country into businesses located in another country.
• The key to FDI is the element of control. Control represents the intent to actively manage and influence a foreign firm’s operations. This is the major differentiating factor between FDI and a passive foreign portfolio investment.

Why in News?

• Foreign investors have continued selling in the Indian market, pulling out a massive ₹85,790 crore (around $10.2 billion) from equities this month due to Chinese stimulus measures, attractive stock valuations, and the elevated pricing of domestic equities.
• October is turning into the worst-ever month in terms of foreign fund outflows. In March 2020, FPIs withdrew ₹61,973 crore from equities.
• Looking ahead, the trajectory of global events like geopolitical developments and interest rate movements will play a crucial role in shaping future foreign investment in Indian equities.

https://www.thehindu.com/business/Economy/fpis-withdraw-85790-cr-from-indian-equities-in-oct-on-attractive-chinese-market-valuations/article68802525.ece