Elephants

AAA

DEFINITION of 'Elephants'

Slang for large institutions that have the funds to make high volumes trades. Due to the large volumes of stock that elephants deal in, any investment decisions that they make will have a large influence on the price of the underlying financial asset.

INVESTOPEDIA EXPLAINS 'Elephants'

Think of a swimming pool: if an elephant steps into the pool (buys into a position), the water level (stock price) increases; if the elephant gets out of the pool (sells a position), the water level (stock price) decreases. In comparison to the elephant's influence on stock prices, the effect of an individual investor is more like that of a mouse.

Examples of elephants are professionally managed entities like mutual funds, pension plans, banks and insurance companies.

Contrarian investors specialize in doing the opposite of the elephants, that is, buying when institutions are selling, and selling when institutions are buying.

RELATED TERMS
  1. Net Institutional Sales - NIS

    A measurement used when screening for securities which are being ...
  2. Blind Bid

    An offer to purchase a bundle of securities without knowing the ...
  3. Contrarian

    An investment style that goes against prevailing market trends ...
  4. Institutional Investor

    A non-bank person or organization that trades securities in large ...
  5. Gorilla

    A company that dominates an industry without having a complete ...
  6. Block Trade

    An order or trade submitted for sale or purchase of a large quantity ...
Related Articles
  1. Institutional Investors And Fundamentals: ...
    Fundamental Analysis

    Institutional Investors And Fundamentals: ...

  2. What's the difference between institutional ...
    Retirement

    What's the difference between institutional ...

  3. What is the
    Investing

    What is the "squawk box scandal"?

  4. Economics Basics
    Economics

    Economics Basics

comments powered by Disqus
Hot Definitions
  1. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  2. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  5. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  6. Budget Deficit

    A status of financial health in which expenditures exceed revenue. The term "budget deficit" is most commonly used to refer ...
Trading Center