2.20What are FIIs and DIIs?
1What is it?
FIIs (Foreign Institutional Investors, now officially FPIs, Foreign Portfolio Investors) are foreign funds investing in India. DIIs (Domestic Institutional Investors) are Indian institutions like mutual funds and LIC.
2Why does it exist?
Their daily net buying or selling is published by the exchanges and watched closely. Heavy FII selling often pushes markets down. DIIs, supported by monthly SIP inflows, often buy when FIIs sell.
3Stock market example
A news line might read: "FIIs net sold ₹3,000 crore; DIIs net bought ₹3,500 crore." That means foreign funds sold more than they bought, and Indian funds absorbed it.
4Diagram
FII net (₹ cr)
₹-3,000
DII net (₹ cr)
₹3,500
5Quick revision
- FII/FPI = foreign institutions.
- DII = Indian institutions (mutual funds, insurers).
- Their flows are reported daily and move markets.
6Knowledge check
Q1. What is the official term for FIIs now?Show answer
FPIs (Foreign Portfolio Investors).
Q2. Name a DII.Show answer
An Indian mutual fund like SBI MF, or LIC.
Q3. What often supports DII buying?Show answer
Monthly SIP inflows into mutual funds.
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