1. If yield differential between Indian and US debt is 4%, then an FII will earn the highest return by investing in debt in India when

2. Suppose an FII borrows at 2% and invests in debt in India at 7.5%. What will be his net return after one year if the exchange rate remains unchanged?

3. When FIIs invest in Indian debt, the two key variables that they consider are

When do fiis make money in the indian debt markets?

when do fiis make money in the indian debt markets?

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FIIs sold off their holding in debt when the rupee began to depreciate. This is because a falling rupee hurts their total return. Watch this investor education video by Moneykraft

AUTHOR(s):Deepa Vasudevan

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