Consider the following statements regarding Foreign Portfolio Investment (FPI):

1. Foreign Portfolio Investment (FPI) is a form of passive investment where investors do not participate in the management of the company.

2. FPI is classified as Foreign Direct Investment (FDI) when the holding exceeds 10% of the total paid-up capital of an Indian company.

3. Foreign Portfolio Investment is highly stable and not affected by market sentiments.

How many of the above statements are correct?