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The big shareholder groups in Dragon Mountain Gold Limited (ASX:DMG) have power over the company. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. 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.'
Dragon Mountain Gold is not a large company by global standards. It has a market capitalization of AU$5.5m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are not on the share registry. Let's delve deeper into each type of owner, to discover more about DMG.
Check out our latest analysis for Dragon Mountain Gold
What Does The Lack Of Institutional Ownership Tell Us About Dragon Mountain Gold?
Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.
There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Dragon Mountain Gold, for yourself, below.
Hedge funds don't have many shares in Dragon Mountain Gold. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Dragon Mountain Gold
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.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
Shareholders would probably be interested to learn that insiders own shares in Dragon Mountain Gold Limited. It has a market capitalization of just AU$5.5m, and insiders have AU$418k worth of shares, in their own names. This shows at least some alignment, but I usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.