Documente Academic
Documente Profesional
Documente Cultură
FII
Their role in the economy is to act as highly specialized investors on behalf of others. For instance, an ordinary person will have a pension from his employer. The employer gives that person's pension contributions to a fund. The fund will buy shares in a company, or some other financial product. Funds are useful because they will hold a broad portfolio of investments in many companies. This spreads risk, so if one company fails, it will be only a small part of the whole fund's investment.
Institutional investors will have a lot of influence in the management of corporations because they will be entitled to exercise the voting rights in a company. They can actively engage in corporate governance. Furthermore, because institutional investors have the freedom to buy and sell shares, they can play a large part in which companies stay solvent, and which go under. Influencing the conduct of listed companies, and providing them with capital are all part of the job of investment management.
FII
Foreign Institutional Investor (FII), refers to the non local investors when invest in the financial market of a country. In other words, the term is most commonly used in India when a foreign entity i.e. an entity which is established or registered outside India proposes to make investment in the financial market of India.
FII-Meaning
The term foreign institutional investment denotes all those investors or investment companies that are not located within the territory of the country in which they are investing. These are actually the outsiders in the financial markets of the particular company. Foreign institutional investment is a common term in the financial sector of India.
The type of institutions that are involved in the foreign institutional investment are as follows: Mutual Funds Hedge Funds Pension Funds Insurance Companies
Following entities proposing to invest on behalf of broad based funds, are also eligible to be registered as FIIs: Asset Management Companies Institutional Portfolio Managers Trustees Power of Attorney Holders
Advantages of FII
Increases Forex reserves Increases domestic savings Increases domestic investments Availability of capital reserve
Disadvantages of FII
Problem of inflation False representation of economy Problem for small investors Hot Money