How Much Of Asia Financial Holdings Limited (HKG:662) Do Institutions Own?

Phillip Young

Wed, Feb 13, 2019, 8:14 PM

The big shareholder groups in Asia Financial Holdings Limited (HKG:662) 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. We also tend to see lower insider ownership in companies that were previously publicly owned.

Asia Financial Holdings is not a large company by global standards. It has a market capitalization of HK$4.6b, which means it wouldn’t have the attention of many institutional investors. In the chart below below, we can see that institutional investors have bought into the company. Let’s delve deeper into each type of owner, to discover more about 662.

View our latest analysis for Asia Financial Holdings

SEHK:662 Ownership Summary February 14th 19

What Does The Institutional Ownership Tell Us About Asia Financial Holdings?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

As you can see, institutional investors own 18% of Asia Financial Holdings. This suggests some credibility amongst professional investors. But we can’t rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Asia Financial Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

SEHK:662 Income Statement Export February 14th 19

Hedge funds don’t have many shares in Asia Financial Holdings. As far I can tell there isn’t analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Asia Financial Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that Asia Financial Holdings Limited insiders own under 1% of the company. However, it’s possible that insiders might have an indirect interest through a more complex structure. It appears that the board holds about HK$15m worth of stock. This compares to a market capitalization of HK$4.6b. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.