The Impact of Foreign Institutional Investors

Foreign Institutional Investors (FIIs) shape the Indian stock market, driving its expansion and advancement.

FIIs are global investors like pension funds, hedge funds, and sovereign wealth funds, regulated by the RBI and SEBI in India.

Key factors influencing FIIs include the US Dollar’s strength, global liquidity, and macroeconomic conditions.

FIIs contribute to market volatility, innovation, and improved corporate governance in India.

India regulates FII investments to stabilize the market, with a 24% cap on equity for companies and 20% for public sector banks.

Despite reduced FII holdings in 2023, India’s market hit an all-time high, driven by domestic investments.

The future sees a shift towards stable Foreign Direct Investments, with India remaining a top destination for FIIs in Asia.

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