An institutional investor is a large investor such as an insurance company, a pension fund, a mutual fund, or a major investment firm. Institutional investors often trade large blocks of stocks or even whole sectors. They are professionally managed.
Institutional investors often find it impractical to invest in small cap stocks. Small caps can be too small to trade in the quantities needed to be of significance to an institutional account. That is one reason they might invest in a sector rather than in a individual stock. Large caps, real estate, and commodities fit better with their goals.
Related Fool Articles
- [link link title]
Recent Mentions on Fool.com
- 5 Takeaways From Johnson Controls Inc. Earnings
- The Greatest Bank Business Model Out There
- Does Goldman Sachs Have Another Billion-Dollar Business In The Works?
- 3 Questions GlaxoSmithKline Investors Want Answered on July 29
- The Court Case that Saved Bank of America $7.6 Billion
- Will This New Marijuana Study Finally Push the Needle Towards Legalization?