The main difference between Foreign Institutional Investors (FII) and Domestic Institutional Investors (DII) is that FII involves foreign capital, typically from investors or institutions based outside the country. On the other hand, DII involves domestic capital, which is sourced from investors or institutions within the same country.

Content :

FII and DII meaning

Foreign Institutional Investors (FII) are entities registered outside India that invest in the financial markets of India. On the other hand, Domestic Institutional Investors (DII) are institutions such as mutual funds, insurance companies, and pension funds that are registered within India and invest in Indian markets.

For example, if Vanguard Group, a U.S.-based investment company, invests in Indian equities, it would be considered an FII. Conversely, if the Life Insurance Corporation of India (LIC) invests in the same equities, it would be categorized as a DII.


The primary difference between Foreign Institutional Investors (FII) and Domestic Institutional Investors (DII) is that FII’s are investors or entities situated outside the country, while DII represents investment capital that comes from institutions or investors located within the nation itself.

Source of CapitalDomesticForeign
Regulatory BodySEBI (Securities and Exchange Board of India)SEBI and respective foreign regulatory bodies
Investment FocusGenerally long-termCan be short-term or long-term
Market ImpactStabilizes the marketCan lead to volatility
Tax TreatmentSubject to Indian tax lawsSubject to Double Taxation Avoidance Agreements (DTAA)
Types of AssetsEquities, bonds, real estateEquities, bonds, derivatives
Economic ImpactLess influence on foreign exchange reservesSignificant influence on foreign exchange reserves

We hope that you are clear about the topic. But there is more to learn and explore when it comes to the stock market, commodity and hence we bring you the important topics and areas that you should know:

Types of non performing assets
What is annual return
Gross NPA vs Net NPA
Pivot point
What is Earnings per share
What is interim dividend
What is final dividend

FII Vs DII – Quick Summary

  • FII involves foreign capital, while DII involves domestic capital.
  • The main difference between DII and FII is the source of capital. DII uses domestic capital, while FII uses foreign capital. 
  • Alice Blue can help you Invest in stocks, mutual funds, & IPOs completely free of cost. They also provide Margin Trade Funding facility, where you can use 4x margin to buy stocks i.e., you can buy stocks worth ₹ 10000 at just ₹ 2500. 


What is the difference between DII and FII?

The primary difference between DII and FII lies in the origin of the investment capital: FII involves foreign capital, and DII involves domestic capital.

What are the examples of FII and DII?

Examples of FII include Vanguard Group and BlackRock, while examples of DII include the Life Insurance Corporation of India (LIC) and HDFC Mutual Fund.

Who are DII investors?

Domestic Institutional Investors (DIIs) are organizations that invest in financial markets within their own country. The most common types of investors among domestic institutional investors (DII) are HDFC AMC, and LIC. Because they’re based in the same country where they invest, they’re subject to local regulations and typically have a deep understanding of the domestic market. 

Why is FII called hot money?

People often call FII “hot money” because it can move quickly in and out of markets, which can cause them to be volatile.

Who is the regulator of FII in India?

In India, FII is mostly regulated by the Securities and Exchange Board of India (SEBI).

How do you analyze FII and DII data?

Analyzing FII and DII data means looking at investment patterns, market trends, and the effect on stock prices and market indices.

To understand the topic and get more information, please read the related stock market articles below.

Bonds vs Stocks
What is Options Trading?
IOC in share market
Aluminium Mini
Stock Split Meaning
How to buy etf
Ofs vs ipo
Fundamental Analysis
How to apply for rights issue
Difference between NSDL and CDSL
What is right issue of shares

Leave a Reply

Your email address will not be published. Required fields are marked *

All Topics
Related Posts
Metal Stocks With High Dividend Yield

Metal  Stocks With High Dividend Yield

The below table shows Metal  Stocks With High Dividend Yields based on the Highest Market Capitalization. Name Market Cap (Cr) Close Price (rs) Vedanta Ltd

Gaming Stocks List In India

Gaming Stocks List In India

The table below shows the Gaming Stocks List In India based on the Highest Market Capitalization. Name Market Cap (Cr) Close Price Tata Consultancy Services

Enjoy Low Brokerage Trading Account In India

Save More Brokerage!!

We have Zero Brokerage on Equity, Mutual Funds & IPO