Portfolio concentration and firm performance

Benjamin Maury, Anders Ekholm

Research output: Contribution to journalArticleScientificpeer-review

22 Citations (Scopus)


This paper investigates the relation between shareholders’ portfolio concentration and firm performance. Using data on more than 1.3 million unique shareholders, we create an index that measures how concentrated shareholder portfolios are in each firm. We posit that portfolio concentration will affect incentives when shareholders are resource constrained. We find that average shareholder portfolio concentration is positively related to future operational performance and valuation. We also find that portfolio concentration is positively correlated with abnormal stock returns. Our findings suggest that shareholders with concentrated portfolios are more informed and play a governance role through the stock market.
Original languageEnglish
Peer-reviewed scientific journalJournal of Financial and Quantitative Analysis
Issue number4
Pages (from-to)903-931
Number of pages29
Publication statusPublished - 01.08.2014
MoE publication typeA1 Journal article - refereed


  • 511 Economics
  • portfolio concentration, ownership concentration, governance through the stock market, profitability, valuation, stock returns
  • 512 Business and Management
  • KOTA2014


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