FPI flows this year ride the coat-tails of ETFs and block deals, shows data

A turnaround in foreign flows has helped domestic markets exceed the all-time highs chalked up in December 2022 and rebound more than 10 per cent from this year's lows

After pulling out $17 billion in calendar year 2022, foreign portfolio investors (FPIs) have pumped $7.3 billion back into equity markets so far this year. The turnaround in foreign flows has helped domestic markets exceed the all-time highs chalked up in December 2022 and bounced back more than 10 per cent from this year’s lows.

However, a big nugget of FPI inflows seen this year could be off the back of two factors: exchange-traded funds (ETFs) and block deals.

Flows coming through the ETF route essentially mean investors are not looking to buy individual stocks but are backing an index, which could