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Every investor in Vonex Limited (ASX:VN8) should be aware of the most powerful shareholder groups. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.’
Vonex is not a large company by global standards. It has a market capitalization of AU$11m, which means it wouldn’t have the attention of many institutional investors. In the chart below below, we can see that institutions are not on the share registry. Let’s delve deeper into each type of owner, to discover more about VN8.
Check out our latest analysis for Vonex
What Does The Lack Of Institutional Ownership Tell Us About Vonex?
Small companies that are not very actively traded often lack institutional investors, but it’s less common to see large companies without them.
There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it’s always possible that professional investors are avoiding a company because they don’t think it’s the best place for their money. Vonex might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.
Vonex is not owned by hedge funds. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Vonex
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our most recent data indicates that insiders own the majority of Vonex Limited. This means they can collectively make decisions for the company. That means they own AU$5.8m worth of shares in the AU$11m company. That’s quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.