Foreign Portfolio Investment ( FPI ) allows global investors to buy stocks, bonds, and assets in foreign markets, boosting liquidity and diversification. Foreign Direct Investment (FDI) and Foreign Portfolio Investment ( FPI ) are two primary avenues through which capital flows across borders. Click here to learn more about FDI vs FPI ! Foreign portfolio investment ( FPI ) is securities and other assets passively held by foreign investors, allowing individuals to invest overseas. Foreign Portfolio Investment ( FPI ) involves foreign investors investing in a country's financial assets like stocks, bonds, and mutual funds to diversify their holdings.