Market Perception of Information Asymmetry; Concentration of Ownership by Different Types of Institutions and Bid-Ask Spread

Information Asymmetry and Cross‐sectional Variation in Insider Trading*

“…As well, Ayers and Freeman (2003) report that prices of firms followed by analysts and largely owned by institutional investors incorporate future earnings earlier than prices of other firms, suggesting that value-relevant information is impounded in price sooner for firms with high institutional ownership and large analyst followings. Other studies that assess whether institutional ownership accelerates the incorporation of new information into price include El-Gazzar 1997; Jiambalvo, Rajgopal, and Venkatachalam 2002;Barabanov and McNamara 2002;and O'Neill and Swisher 2003. Studies that link analyst following to bid -ask spreads and liquidity include Brennan and Subrahmanyam 1998;Easley, O'Hara, and Paperman 1998;Roulstone 2003a;and Kanagaretnam, Lobo, and Whalen 2004.…”

Ownership level, ownership concentration and liquidity

“…While the focus of most empirical studies on the ownership-liquidity relation is on the adverse selection hypothesis (e.g., Chiang and Venkatesh, 1988;Kini and Mian, 1995;Heflin and Shaw, 2000;Barabanov and McNamara, 2002), there is no consensus in the literature about which entities constitute the informed group of investors. Some studies focus on insiders, some focus on institutions, and some focus on blockholders.…”

Ownership structure and minority rights: A Latin American view

“…where S li represents the number of shares of company i owned by group l (Barabanov & McNamara, 2002). HI measures ownership concentration and becomes a proxy for the expropriation of minority shareholder's right.…”