Foreign direct investments are commonly categorized as being horizontal, vertical or
conglomerate in nature.
A horizontal direct investment : In this type of investment , investor establish the same type of business operation in the foreign countries as it operates in its home country.
A vertical direct investment: A vertical investment is one in which different but related business activities from the investor’s main business are established or acquired in a foreign country.
A conglomerate type of foreign direct investment is one where a company or individual makesa foreign investment in a business that is unrelated to its existing business in its home country.