Understanding Different Investor Types and Categories in India

Understanding Different Investor Types and Categories in India

There are various types of Investors in the stock market. Do you know which investor category you belong to? 

After reading this article, I am sure you will recognize the category you belong to as an investor and gain insights about your investment style and approach. 

Understanding risk appetite is also crucial as it provides insights about the risk you will take to invest and gain profits. We will also discuss types of investors based on their risk appetite.

Investor Groups by Investment Category

Imagine the stock market as a large pizza. Each slice represents a different investor group. Let's take a bite-sized look at each:

• Retail investors: These are people who invest in the stock market to achieve higher returns than traditional savings accounts.
   
• Institutional Investors: Institutional Investors are organizations that pool money from different clients and invest on their behalf in various financial instruments like mutual funds, pension funds, and insurance. 
   
• Traders: These are investors who do not seek long-term growth. They focus on short-term profits and profit from stock market price fluctuations throughout the day.
   
•  High-net-worth individuals (HNIs): These are people with five crore rupees or more in investment assets. A growing number are expected over the coming years, and these wealthy individuals have considerable influence on the market.
   
• Domestic Institutional Investors (DIIs): The institutional investors of India who invest in Financial Markets like pension funds, mutual funds, banks, etc, within the country's borders. 
   
• Foreign Institutional Investors (FIIs) or Foreign Portfolio Investors (FPIs): These are the foreign institutional investors who invest in Financial Markets on behalf of their clients in India. They bring capital that increases the country's liquidity, and their investment in our country is taken as a sign of confidence.
  
  FIIs include institutional investors who invest in pension funds, mutual funds, sovereign wealth funds, hedge funds, and other similar funds. They have a significant influence on market sentiment and capital inflows.

They all different approach

Example - Each company have there Stock holders 

FII in %

DII in % 

FPI in % 

Retail % 

HNI in % 

Leats see Example = below 

This is how you can figure out who holds the big part 

Before buying check all these details so you can buy quality stock 

Hope you get clear incite about this 

Keep reading wise investing 

Investing in knowledge pays the best interest