Question

Portfolio Investment mostly represents the sale and purchase of:___________. A. Foreign financial assets such as stocks and bonds that do not involve a transfer of control. B. Foreign Direct Investment mostly represents the sale and purchase of foreign financial assets such as stocks whereas Portfolio Investment mostly involves the sales and purchase of foreign bonds. C. Foreign Direct Investment is about buying land and building factories, whereas portfolio investment is about buying stocks and bonds. D. All of the options.

Answer 1

Option A is correct

Step-by-step explanation:

The reason is that the control of the financial asset is not delivered to the investor as the investment is more than one companies and management of investments in a number of companies to diversify the income arising from these investments. Option B is not the definition of foreign direct investment. It is the definition of Portfolio investments. Option C is also incorrect because it is partially correct because the portfolio investment includes selling of financial assets too.