What Does Stock Ownership Breadth Measure?

  title={What Does Stock Ownership Breadth Measure?},
  author={James J. Choi and Li Hong Jin and Hongjun Yan},
  journal={Review of finance},
  volume={17 4},
Using holdings data on a representative sample of all Shanghai Stock Exchange investors, we show that increases in ownership breadth (the fraction of market participants who own a stock) predict low returns: highest change quintile stocks underperform lowest quintile stocks by 23% per year. Small retail investors drive this result. Retail ownership breadth increases appear to be correlated with overpricing. Among institutional investors, however, the opposite holds: Stocks in the top decile of… CONTINUE READING

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