The big shareholder groups in South West Pinnacle Exploration Limited (NSE:SOUTHWEST) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

South West Pinnacle Exploration is not a large company by global standards. It has a market capitalization of ₹473m, which means it wouldn't have the attention of many institutional investors. In the chart below below, we can see that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about SOUTHWEST.

Check out our latest analysis for South West Pinnacle Exploration

What Does The Institutional Ownership Tell Us About South West Pinnacle Exploration?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

South West Pinnacle Exploration already has institutions on the share registry. Indeed, they own 17% of the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of South West Pinnacle Exploration, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in South West Pinnacle Exploration. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of South West Pinnacle Exploration

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.