Every investor in Goldin Financial Holdings Limited (HKG:530) should be aware of the most powerful shareholder groups. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. I quite like to see at least a little bit of insider ownership. As Charlie Munger said ‘Show me the incentive and I will show you the outcome.’
With a market capitalization of HK$19b, Goldin Financial Holdings is a decent size, so it is probably on the radar of institutional investors. Taking a look at the our data on the ownership groups (below), it’s seems that institutions don’t own shares in the company. We can zoom in on the different ownership groups, to learn more about 530.
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What Does The Lack Of Institutional Ownership Tell Us About Goldin Financial Holdings?
We don’t tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it’s not particularly common.
There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. Alternatively, there might be something about the company that has kept institutional investors away. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Goldin Financial Holdings, for yourself, below.
Hedge funds don’t have many shares in Goldin Financial Holdings. Our information suggests that there isn’t any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Goldin Financial Holdings
The definition of company insiders can be subjective, and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.