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The Performance Of Institutional Investor Trades Across The Supply Chain, Dallin Max Alldredge
The Performance Of Institutional Investor Trades Across The Supply Chain, Dallin Max Alldredge
Doctoral Dissertations
In this paper I investigate institutional ownership and trading across the supply chain. I find that institutions are more likely to own stock in a supplier firm, if they own stock in an economically linked customer firm. Institutions with stock in a pair of customer-supplier linked firms (i.e. joint owners) experience abnormal trading profits in supplier stocks. The magnitude of trading profits increases when institutions own a larger stake in the customer and when the supplier relies upon a concentrated customer base for sales revenue. Furthermore, I document that joint owner trading predicts unexpected earnings news, consistent with these institutional …