Corporate Finance: Instructor\'s Manual Applied Corporate Finance

Aswath Damodaran 76

Analyzing the investor bases...

Disney Deutsche Bank Aracruz (non-voting)

Mutual Funds 31 % 16 % 29 %

Other

Institutional

Investors

42 % 58 % 26 %

Individuals 27 % 26 % 45 %

These companies are predominantly held by institutions who also do much of

the trading on the stock. Insiders hold almost no stock in the company.... The

marginal investor is an institutional investor.... Aracruz has the highest

percentage of individual investors and it also has voting shares held by insiders.

We would be most cautious in extending the marginal investor is diversified

argument to Aracruz.