Institutional Investor
An institutional investor is a large entity that manages and invests money on behalf of clients. Examples include:
- Pension Funds → Retirement funds for workers.
- Mutual Funds & ETFs → Investment funds pooling retail investor money.
- Insurance Companies → Managing premium payments for future claims.
Institutional investors control massive amounts of capital, allowing them to move markets more significantly than individual retail investors.
Retail vs. Institutional Investors:
| Feature | Retail Investor | Institutional Investor |
|---|---|---|
| Capital | Limited personal funds | Large-scale capital (millions/billions) |
| Execution Speed | Slower, limited tools | Faster, with direct market access |
| Market Influence | Less impact individually | Moves markets with large trades |
| Investment Strategy | Often emotional, speculative | Data-driven, algorithmic |
See also: Retail Investor