Why foreign-invested enterprises matter to investors
If you're considering investing in a company that's a foreign-invested enterprise, it's important that you understand what you're getting into, especially if it's your first foreign investment. There are often different rules, including different reporting requirements, for companies based outside of the United States, and there may also be particular business nuances that will be important to understand before investing.
Knowing if a company is a FIE will tell you to dig deeper into it since it may be harder to verify certain types of data, depending on the type of company. A little extra due diligence is sometimes too much, but in the case of any company owned and operated outside of the United States, it can pay to be careful. Not every stock you buy will be a winner, no matter where the company is based, but extra caution can ensure that FIEs aren't money pits out of the gate.