Definition of FDI / Foreign Direct Investment

Definition: FDI stands for Foreign Direct Investment, a component of a country's national financial accounts. Foreign direct investment is investment of foreign assets into domestic structures, equipment, and organizations. It does not include foreign investment into the stock markets. Foreign direct investment is thought to be more useful to a country than investments in the equity of its companies because equity investments are potentially "hot money" which can leave at the first sign of trouble, whereas FDI is durable and generally useful whether things go well or badly.

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Econterms. "Definition of FDI / Foreign Direct Investment." ThoughtCo, Dec. 16, 2014, thoughtco.com/definition-of-foreign-direct-investment-1146093. Econterms. (2014, December 16). Definition of FDI / Foreign Direct Investment. Retrieved from https://www.thoughtco.com/definition-of-foreign-direct-investment-1146093 Econterms. "Definition of FDI / Foreign Direct Investment." ThoughtCo. https://www.thoughtco.com/definition-of-foreign-direct-investment-1146093 (accessed November 19, 2017).