Foreign portfolio investment (FPI) refers to investing in the financial assets of a foreign country, such as stocks or bonds available on an exchange.  

• This type of investment is at times viewed less favorably than direct investment because portfolio investments can be sold off quickly and are at times seen as short-term attempts to make money, rather than a long-term investment in the economy.  
• Portfolio investment typically has a shorter time frame for investment return than direct investment.  

• As with any equity investment, foreign portfolio investors usually expect to quickly realize a profit on their investments.  
• Unlike direct investment, portfolio investment does not offer control over the business entity in which the investment is made. 

Source: TMH Ramesh Singh