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Finance: What is an Institutional Investor? 1 Views


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Description:

What is an institutional investor? Hit play to find out

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English Language

Transcript

00:00

Finance a la shmoop what is an institutional investor? institution think

00:09

mutual fund company like fidelity or Wellington or State Street or Blackrock [Mutual fund companies appear]

00:14

also think hedge fund think giant pension fund or even a small one the

00:20

"institutional" part of this term means that the investor is a

00:26

professional they've likely gone to grad school taken a bunch of licensing exams

00:31

are really good at math and accounting good at poker probably as well [Person checks cards on poker table]

00:34

apprenticed with old people who mumble through chewed cigars about what the IPO

00:39

of Ford was like with Henry that whippersnapper and those investors are

00:44

professionally responsible for managing OPM other people's money standards are

00:50

higher when you lose someone else's money versus your own

00:53

well the institution behind them raises and retains the dough which is they then [Investor receives cash]

00:57

invest often in large chunks and their viewed as a different class by many

01:02

because unlike the cardiologists investor Club of Northeast Milwaukee

01:07

these investors actually understand the risks they're taking when they invest so [Men stood outside cardiologist investor club sign]

01:13

if a given stock shows tens of thousands of hundreds share trades odds are good

01:18

that cardiologists and their friends are buying in on tips they got from the golf

01:23

course if the trade blocks are in hunks of a hundred thousand or a million [Stocks in a sack of million shares]

01:27

shares each per block that is odds are good that well these are schooled

01:32

institutions buying and selling shares with a presumption that the

01:36

institutional investors will generally know what they're doing or at least more

01:40

so than the you know non institutional getting there so why would you want to

01:44

be an institutional investor? answer = bank if you're good and very very few people [Man discussing institutional investors]

01:51

actually are but if you are one of the vaunted few the proud the knowledgeable

01:56

who beats the market regularly in good markets and bad and can do it at scale

02:02

on hundreds of millions or billions of dollars invested well then you can

02:06

expect to make tens of millions of dollars a year [Man throws cash into the air]

02:09

shepherding the wealth of the wealthy or at least of

02:12

masses collecting your fees and whining about taxes until the cows come home [Cows appear on a field]

02:16

when did they leave anyway?

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