Institutional ownership of a stock How often is this reported?

February 20, 2012 2:23 PM

I can log onto my Ameritrade account and find the percentage of a company's stock that is "Held by Institutions". How often is this information reported and what constitutes an "Institution"?

I own a stock that trades on the Toronto and AMEX exchanges and I frequently check the "% Held by Inst", but don't check it daily. The number seems to stay stagnant for a period of time and then suddenly jump up, but it doesn't seem like the number changes at regular intervals (monthly, quarterly, etc.). I was wondering what the trigger or reporting requirement is that causes the number to suddenly change. It seems like it can stay the same for two months and then change twice in the same month. The number is reported to two decimal places but certainly doesn't change very often relative to the precision of the number.

posted by Rafaelloello to work & money (4 answers total)

On the US side, there are specific rules about what an institution is, and how often it must disclose shareholdings. I recall that the rules are rather antiquated - disclosure is only required on a quarterly basis, and high-frequency funds might hold a stock for minutes or hours.

Example, Renaissance Technologies' Form 13F filing. The filing is a joke because Renaissance is one of the pioneers in high-frequency trading. It is unlikely that they held any of hte listed stocks for more than a day.
posted by b1tr0t at 2:35 PM on February 20, 2012

The institutions they are referring to generally are big pension funds and mutual funds like Vanguard and Fidelity, insurance companies and some university endowments. These funds own huge positions when they invest in a company. It's a way of gauging how the professional money managers who run these funds view a company.
posted by up in the old hotel at 2:48 PM on February 20, 2012

US:
reported quarterly for all money managers with over 100 mil in Assets Under Management. Must be filed by the 15th of the Second month of the following quarter. I.e. Feb 15th for holdings on 12/31. If you become a greater than 5% holder of a security you have to file "in a timely fashion" for any changes in ownership - no clear definition of that exact timing tho.

Don't know what the Canadian rules are. European rules are very iffy - most countries require some information above 5%, most mutual funds will report semi-annual what they hold.

It's a way of gauging how the professional money managers who run these funds view a company.
Hmm. Sorta is how I would answer that. If its a huge company its probably just an indication of who the biggest institutions are or who the biggest index/ETF managers are.
posted by JPD at 4:02 PM on February 20, 2012

Antiquated it may be, but also possibly deliberate to keep a significant lag time between the holding and the reporting. If it were instantaneous, then competing institutions could just piggyback on the trading. Of course, the high-frequency traders have made it their business to trade in front of the institutional moves through other means, so that reasoning may not be relevant any more.
posted by wnissen at 5:34 PM on February 20, 2012