direct investment

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Related to Direct Investments: FDI, Foreign Direct Investments

Direct investment

The purchase of a controlling interest in a company or at least enough interest to have enough influence to direct the course of the company.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Direct Investment

The act or practice of buying stock in a publicly-traded company without using a broker as an intermediary. Perhaps the most common means of direct investment is dividend reinvestment, which is the act of using one's dividends to buy more shares in the same company. Some companies also offer plans called direct purchase plans, which allow investors to bypass their broker. However, direct purchase plans are rather illiquid (it is difficult to sell one's shares without a broker), and are therefore bought for long-term investing.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

Direct investment.

You can make a direct investment in a company's stock through dividend reinvestment plans (DRIPs) and direct purchase plans (DPPs).

If a company in which you own stock offers a DRIP, you have the opportunity to reinvest cash dividends and capital gains distributions in more stock automatically each time they are paid.

In the case of DPPs, also known as direct stock purchase plans (DSPs), companies can sell their stock directly to investors without using a brokerage firm as intermediary.

Direct investment also refers to long-term investments in limited partnerships that invest in real estate, leased equipment, and energy exploration and development. In this type of investment, you become part owner of the hard assets of the enterprise.

You realize income from your investment by receiving a portion of the business's profits, for example, from rents, contractual leasing payments, or oil sales. In some cases you realize capital gains at the end of the investment term, if the business sells its assets.

These DPPs are largely nontraded and have no formal secondary markets. This means you will often have to hold the investment for terms of eight years or more, with no guarantee that any of the income or capital gains will materialize.

Many people make direct investments because there can be significant tax benefits, such as tax deferral and tax abatement, depending on the investment.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

direct investment

Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

direct investment

any expenditure on physical ASSETS such as plant, machinery and stocks. See INVESTMENT.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
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In the first quarter of 2019, for instance, the net inflow of foreign direct investments reached $1.9 billion, down 15.1 percent from the $2.3 billion in the same period last year.
He believes that direct investment is the biggest challenge for the EGX, and the stock market must be strong to attract direct investment as an exiting mechanism.
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Thus, 72.5 percent ($2.08 billion) of direct investments was made in Azerbaijan's oil and gas sector, while the remaining $785.8 million was made in other spheres.
Total FDI from the UAE, which came at second position in terms of direct investments in Oman, stood at RO949.3mn as of the end of third quarter of 2017 compared with RO785.8mn a year ago.
The foreign direct investment (FDI) in Abu Dhabi grew by 8.6 per cent to Dh88.95 billion in 2015 compared with Dh81 billion in 2014, according to a foreign investment survey conducted by Abu Dhabi Statistics Centre.
Significant increase in foreign direct investments, on the contrary, is observed from Belarus - $56.9 thousand in January-September 2014 against $13.7 thousand in January-September 2013; from Kazakhstan - $38.5 million in 2014 against $36.9 million in 2013.
In Q1, 2014, foreign direct investment in Bulgaria stood at EUR 218.5 M (0.5% of GDP), compared to EUR 305.1 M (0.8% of GDP) in the same period of 2013, down by EUR 86.6 M (28.4%), according to preliminary data of BNB.
The Central Bank of Egypt (CBE) pointed out that in the third quarter of 2010/11, foreign direct investment declined at a rate of 90.4 percent compared to the same quarter of 2009-2010, while net inflows reached about 1.8 billion US dollars.
Foreign direct investment in the United States dropped sharply in 2012 after rebounded slowly in 2010 and 2011 after falling from the $310 billion recorded in 2008.

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