You may have heard economists or financial analysts talk about institutional investors. What do these type of investors refer to? How are they different from retail investors?
Institutional investors are not individuals but rather nonbank organizations that buy and sell securities on behalf of their members. They trade securities in large enough quantities to qualify for preferential treatment and lower commissions, which makes them the primary point of contact for individuals looking to invest in the market.
In general, there are six types of institutional investors:
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