Determine the Long-term direct investment flows

Long-term direct investment flows are when investors buy physical assets like land or capital equipment in another nation. This form of investment will normally be undertaken with a view to a long-term commitment producing in the country over some years.

Long-term portfolio capital flows are when investors buy equities and bonds in another nation with a view to holding these assets again for a period of years.

In contrast short-term speculative 'hot money' flows move extremely quickly. For some traders holding bonds or shares for longer than two minutes is considered to be the very long run. Speculative currency flows are caused first by different currencies earning different interest rates and second by speculative belief which exchange rates will fall or rise.