What is the significance of share holding pattern of a stock do we have any ideal % mix of promoter,fii,dii,public holding,should there be a balance between holdings
Generally it is true that insiders know real material information compared to others. Promoters, directors, employees form insider group. If they are buying or holding more shares it can be considered as a positive factor, but as the company grows and matures it is obvious for promoters to cut down their holdings for various reasons.
DIIs and FIIs do more research than individuals so some mix of those is no harm but it should be noted having FIIs and DIIs has both pros and cons as the stock can be prone to higher volatility as they get in and get out quickly and with volumes.
If the retailers are more then it can be considered as positive sign as the more is involved the more liquidity with lesser impact costs and slippages thus would be difficult for anyone to corner the stock.
So, along with promoters percentage of holding due importance should be given to factors like growth stage of company (market cap), competitor firms share holding patterns, the reasons for selling promoters stake along with other fundamentals and macros.
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