Mavericks, Universal, and Common Owners - The Largest Shareholders of U.S. Public Firms

Abstract

Using a novel data set, we show that up to one-fifth of America's largest firms had an activist, non-financial blockholder, or insider as their largest shareholder in the past 20 years. Blockholders and insiders tend to be less diversified than institutional investors. Measures of ``universal'' and ``common'' ownership of firms are therefore lower than previously believed based on analyses of institutional investors' holdings alone, and the heterogeneity in ownership structures across firms is greater. Activism contributes positively to common ownership of industry rivals, as do the ``Big 3'' and consolidation in the asset management industry. We conclude that policy makers can reduce within-industry common ownership without sacrificing diversification or market indexing.

Keywords: universal ownership, common ownership, institutional ownership, blockholders, insiders, antitrust, governance

JEL Classification: G23, G34, L21, L40