Understanding FII/DII Activity

What is FII?

FII’ stands for ‘foreign institutional investor’. It refers to an investment fund or an investor who puts their money into a country’s assets while headquartering outside the country.

What is DII?

DII’ stands for ‘domestic institutional investors.’ Unlike FIIs, DIIs are investors that invest in the financial assets and securities of the country they reside in.

What Types of FII vs DIIs are allowed in India?

Types of FIIs:

  1. International Pension Funds
  2. Mutual funds
  3. Investment Trusts
  4. Banks
  5. Insurance company/Reinsurance company
  6. Foreign government agencies
  7. Sovereign Wealth Funds
  8. International Multilateral organization
  9. Endowments for public interest
  10. Charitable Trusts for public interest
  11. Foundations for public interest
  12. Foreign Central Banks
  13. University Funds serving public interests

Types of DIIs:

  1. Indian Mutual Funds
  2. Local Pension Funds
  3. Indian Banking and Financial Institutions
  4. Indian Insurance Companies

FIIs and DIIs are market strength and liquidity indicators. You must follow FII and DII as an investor to better comprehend market fluctuations. But it would be naive to follow either of them blindly.

Additional Resources:

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