Empirical Study on the Preference of Shareholding of Institutional Investors after Split Share Structure Reform

摘要

Since the 1960s, rapid development of institutional investors is a prominent feature of global financial market. In china, full circulation of stock will realize after the completion of Split Share Structure Reform. Under the circumstance of institutional investors holding a large scale of stock, will they change their invest style? Whether they place more emphasis on value investment and concerning about long-term development of their enterprises or utilize their advantage of controlling large scale of capital, continue to use "dominate" and "speculation" methods to seek short-term interests? In this paper, we focus on institutional investor's preference for stocks, trying to find certain evidence from their stock preference to judge whether the institutional investors were intended to make long-term investment or short-term investment when they invested in stocks. Here we used the stocks holding by institutional investors at the end of the fourth quarter from 2003 to 2007 to perform empirical analysis. The regression results of non-equilibrium panel data model indicate that there is a definite positive correlation between market value of negotiable shares and the rate of shareholdings by institutional investors. Our conclusion support the statement that institutional investors were preferred to holding large capitalization stocks. The volatility of large capitalization stocks are less than small capitalization stocks, and the information disclosure degree of large capitalization stocks is higher than small capitalization stocks. Therefore, the actions of institutional investors prefer large capitalization stocks indicates that when they were selecting the stock, they didn't intended to perform short-term "speculation", but to long-term investment.