Abstract
Common asset holdings have received a lot of attention recently, but little is known about how overlapping investors' portfolios are in the real world. Using data on U.S. institutional investors' stock portfolios for the period 1990–2014, we document a strong and significant overlap in the average pair of investors' portfolios. This strong portfolio overlap is the main reason for why it is difficult to detect institutions with superior performances. In fact, while specialized investors appear to emphasize certain stock-specific characteristics, their performances are not significantly different from those of diversified investors. Overall, these findings suggest that specialist investors are not very special.
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