Stock Performance Since the Market Top Based On Market Cap and Institutional Ownership

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Hickey and Walters (Bespoke) submit: We recently analyzed the performance of stocks since the 7/19 top based on numerous fundamental and technical categories. Below we highlight the performance of stocks based on market cap and institutional ownership.

We broke the Russell 1,000 into deciles (100 stocks per decile) and calculated the average percent change of the stocks in each decile from 7/19 to 8/10. The first chart below highlights deciles based on market cap. As shown, the decile of the largest stocks in the index (100 largest) averaged a decline of 6.8% and the second largest decile was down 5.9%. As the deciles get smaller, the declines get worse, indicating that larger cap names have held up the best throughout the correction.

russell 1000

The second chart below highlights the performance of stocks since 7/19 based on institutional ownership. It shows that the larger the institutional ownership, the worse the performance. The 100 stocks in the Russell 1,000 with the largest institutional ownership averaged a decline of 11.1% from 7/19 to 8/10.

This highlights the recent struggles of institutions like hedge funds. The declines in stocks with large institutional ownership were exacerbated by forced liquidations and the deleveraging of portfolios and not necessarily because their underlying fundamentals broke down. Because of this, we're looking through the list for ones that were unduly hit.

russell 1000 institutional

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