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      Question

      A Foreign Portfolio Investor invests in Indian capital

      market without aiming for management control and focusing on financial returns. FPI can hold up to _____ ownership in a listed Indian company via equity markets.
      A 5% Correct Answer Incorrect Answer
      B 10% Correct Answer Incorrect Answer
      C 12% Correct Answer Incorrect Answer
      D 15% Correct Answer Incorrect Answer
      E 20% Correct Answer Incorrect Answer

      Solution

      Foreign Portfolio Investment (FPI) is when non-residents invest in Indian financial assets (stocks, bonds, mutual funds, ETFs) without aiming for management control, focusing on financial returns, typically less than 10% of a listed company's equity, and are regulated by SEBI under FEMA guidelines for foreign exchange compliance. They differ from FDI by lacking ownership control and focusing on market liquidity and capital inflow.

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