Price pressure and the role of institutional investors in closed-end funds

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28 Scopus citations

Abstract

A trader-identified transactions database is employed to investigate: (1) the relation between order-flow imbalance and closed-end fund share prices and discounts; and (2) the role of institutional investors in closed-end funds. Empirical results are consistent with the hypothesis that buyers (sellers) of closed-end funds face upward-downward-) sloping supply (demand) curves. The results also demonstrate that ownership statistics do not accurately reflect institutional investors' importance in the closed-end fund market. The results fail to provide evidence that institutional investors offset the positions of individual investors or that institutional investors face systematic “noise trader risk.”.

Original languageEnglish (US)
Pages (from-to)211-229
Number of pages19
JournalJournal of Financial Research
Volume20
Issue number2
DOIs
StatePublished - Jun 1997
Externally publishedYes

ASJC Scopus subject areas

  • Accounting
  • Finance

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