Institutional Investors

Institutional Investment is a kind of investment done by an organization on behalf of its clients. Institutional investors pool together their funds and invest in a variety of financial instruments such as stocks, bonds, real estate etc. There are different types of institutional investors such as pension funds, endowment funds, insurance companies, mutual funds and hedge funds.

Institutional investors trade securities in large quantities so they get preferential treatment and lower commissions. Moreover, these investors generally need to deal with fewer regulations and participate in the private placement of securities by companies. Because they trade in large quantities, they are the largest force behind demand and supply, and also have a major influence on the prices of many securities.