Passive Institutional Ownership and the Informational Efficiency of Stock Prices

Jingxin Hu, Lihong Liang, Department of Accounting and International Business, University of Houston-Downtown, Joseph I. Lubin School of Accounting, Syracuse University

Journal of Accounting, Auditing & Finance

Published online on March 23, 2026

Abstract

Journal of Accounting, Auditing & Finance, Ahead of Print.
We examine how passive institutional ownership affects the informational efficiency of stock prices. Because passive institutional investors prefer greater transparency, their presence encourages managers to enhance firm disclosure (Boone & White, 2015; ...