An investor is analyzing two firms in the same industry which are basically identical. She is looking for long-term performance from her investment. Both firms are undergoing restructuring. One firm is involved in substantial downsizing, and the other firm is undertaking aggressive downscoping. The investor should invest in the:

Downscoping is the process of getting rid of enterprises that are unrelated to the company's core business through spinoffs, divestitures, or other methods.
To focus on the company's core businesses, in other words, is what downsizing entails.
Although downsizing is frequently a part of downscoping, the former is designed to prevent the loss of important people from vital businesses (because such losses can lead to the loss of core competencies).

One of the most popular restructuring techniques used globally has been downsizing.
Downsizing signifies a reduction in the workforce and, occasionally, the number of operational units, although it may or may not also indicate a shift in the portfolio's business mix.

An investor is a person or a group of people who invest money in the hope of someday making a profit.
This wide term encompasses everyone, including Wall Street institutions, startup accelerators, and even relatives who lend money to one another.

There are namely 3 types of investors:

This is a general word for those who haven't started investing yet. It covers friends, relatives, and close personal contacts but excludes all professional investors.
These are folks that are new to investing but may have money they are willing to put into your company.

Passive investors adopt a buy-and-hold strategy that they anticipate will pay off in the long run and restrict the amount of hands-on management they individually provide to the assets they own.
A passive investor will defer to the operational and financial decisions made by the management team rather than taking an active part in the management of a firm.

A hands-on approach is taken by active investors while managing their portfolios.
These investors want to have a say in how their funds are managed. In a private equity setting, active investors could bring in new personnel to support management teams and assertively alter the organizational structure of a company.

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