1 option
The Granular Nature of Large Institutional Investors / Itzhak Ben-David, Francesco Franzoni, Rabih Moussawi, John Sedunov.
- Format:
- Book
- Author/Creator:
- Ben-David, Itzhak.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w22247.
- NBER working paper series no. w22247
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2016.
- Summary:
- Large institutional investors own an increasing share of the equity markets in the U.S. The implications of this development for financial markets are still unclear. The paper presents novel empirical evidence that ownership by large institutions predicts higher volatility and greater noise in stock prices as well as greater fragility in times of crisis. When studying the channel, we find that large institutional investors exhibit traits of granularity, i.e., subunits within a firm display correlated behavior, which reduces diversification of idiosyncratic shocks. Thus, large institutions trade larger volumes and induce greater price impact.
- Notes:
- Print version record
- May 2016.
The Penn Libraries is committed to describing library materials using current, accurate, and responsible language. If you discover outdated or inaccurate language, please fill out this feedback form to report it and suggest alternative language.