Institutional investors, such as mutual funds, pension funds, insurance companies, and hedge funds, manage large sums of money and invest in the stock market on behalf of their clients.
Their role is crucial in providing stability, liquidity, and price efficiency to the market. Since they trade in high volumes, institutional investors influence stock prices and market trends.
Their research-driven investment decisions often signal confidence in a company's prospects, impacting retail investor sentiment.
Additionally, they promote corporate governance by engaging with companies on management and policy decisions.
Their participation strengthens market depth, ensuring efficient price discovery and long-term growth.
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