Discussion – Foreign Investments
Two types of foreign investment exist: Foreign Portfolio Investments (FPI) and Foreign Direct Investments (FDI). The difference between these two is determined by the level control sought and gained by the investor. FPI is passive while FDI is more aggressive in its methods of acquisitions. Because of its aggressiveness, most investment theories are based on the assumptions of FDI. Therefore, strategies to acquire goods, services, and capital have an active sense of investment.
With the above in mind, identify and discuss an investment strategy. Express the advantages of your strategy based on an international investment theory.