THE RELATION BETWEEN INVESTOR OWNERSHIP AND CORPORATES INVESTMENT, PAYOUTS, AND PROFITABILITY

How corporate using their cash holding of public firms has been a more and more important factor for investors to observe investment opportunity in companies. Institutional investors have been a major role of corporate investing, and the institutional investors can benefit the firms’ performance and improve the efficiency by providing monitoring to the corporations’ governance (Boone and White, 2015). So, I hypothesize that the investors will affect the use of cash holdings, investment, payouts, and profitability by monitoring the managers, and the long-term investors may have more influence. In this article, I tried to examine the hypothesis through empirical study.