Foreign portfolio investment: a comparison between Malaysia and China/ Nurrul Atia Abdul Rahman

Foreign portfolio investment (FPI) consists of grouping of securities such as stocks, bonds and cash equivalents. It is held directly by the investors and financial professionals. In economics, foreign portfolio investment defined as the entry of funds into a country where the foreigners deposit some money to country's bank or by purchasing stocks or bonds in that country. In other words, they provide the investor With indirect ownership of financial assets. This study intends to investigate the economic factors Which attract the investors to invest in the host country. The Countries that are chosen for this study are Malaysia and China. Malaysia and China have diplomatic relations since 1974. They are the third largest trade partner in Asia. Hence, this study is to determine what are the economic factors or decisions of the foreign investors to invest in the foreign countries which are Malaysia and China. To elaborate the results, multiple regression models are used by using E-views. The data Of FPL GDP, exchange rate, and FDI has been taken from the World bank. GDP and exchange rate are the strong determinants of FPL the FDI shows have significant impact on the FPL