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Show HN: Common ownership between S&P 500 companies

45 points by greatwave1 6y ago

greatwave1 6y ago
Over the last few weeks, I’ve been using a break from school to take on a number of financial data projects, some of which I’ve posted on here. The latest is a dashboard that allows you to find shared ownership between any two S&P 500 companies, using data scraped from Yahoo Finance. This project was inspired by “The Problem of 12”, the fact that most public companies are increasingly being controlled by a small group of institutional investors: https://ssrn.com/abstract=3247337 https://ssrn.com/abstract=3247337 There is compelling evidence that this shared ownership can lead to anticompetitive outcomes, such as lower wages and higher prices: https://ssrn.com/abstract=2427345 https://ssrn.com/abstract=2427345. My goal is to highlight the extent to which ownership of many competing companies is being concentrated among a small number of institutions, and spark discussion about this problem. Let me know if you have any suggestions for improvements to the dashboard, or ideas for new projects for me to work on!
legitster 6y ago
This data is kind of interesting, but holdup: >"We are rapidly moving into a world in which the bulk of equity capital of large companies with dispersed ownership will be owned by a small number of institutions... It is not an exaggeration to say that even if this mega-trend begins to taper off, the majority of the 1,000 largest U.S. companies will be controlled by a dozen or fewer people over the next ten to twenty years." >- John C. Coates, IV, Harvard Law, "The Problem of Twelve" The data on the page counteracts this point, nearly all the examples presented are of wealth management funds or holding companies, representing millions and millions of people. The #1 investor is literally Vanguard, the investor cooperative.
- greatwave1 6y ago
  That quote isn't talking about wealth inequality, it's referencing concentration in corporate governance power. While funds like Vanguard are financed by investments from millions of people, the leaders of those funds control the voting power of all of their shares. This could cause anticompetitive behavior, when the same funds/holding companies have large stakes in all of the players within a given industry.
  - deleted 6y ago
    [deleted]
  - rckoepke 6y ago
    I really feel that Vanguard et. al should let votes be pass through. I'm sure there would be massive amounts of abstention but I don't see how that would be a problem per se.

45 points by greatwave1 6y ago

Over the last few weeks, I’ve been using a break from school to take on a number of financial data projects, some of which I’ve posted on here. The latest is a dashboard that allows you to find shared ownership between any two S&P 500 companies, using data scraped from Yahoo Finance. This project was inspired by “The Problem of 12”, the fact that most public companies are increasingly being controlled by a small group of institutional investors: https://ssrn.com/abstract=3247337 https://ssrn.com/abstract=3247337 There is compelling evidence that this shared ownership can lead to anticompetitive outcomes, such as lower wages and higher prices: https://ssrn.com/abstract=2427345 https://ssrn.com/abstract=2427345. My goal is to highlight the extent to which ownership of many competing companies is being concentrated among a small number of institutions, and spark discussion about this problem. Let me know if you have any suggestions for improvements to the dashboard, or ideas for new projects for me to work on!

legitster 6y ago

This data is kind of interesting, but holdup: >"We are rapidly moving into a world in which the bulk of equity capital of large companies with dispersed ownership will be owned by a small number of institutions... It is not an exaggeration to say that even if this mega-trend begins to taper off, the majority of the 1,000 largest U.S. companies will be controlled by a dozen or fewer people over the next ten to twenty years." >- John C. Coates, IV, Harvard Law, "The Problem of Twelve" The data on the page counteracts this point, nearly all the examples presented are of wealth management funds or holding companies, representing millions and millions of people. The #1 investor is literally Vanguard, the investor cooperative.

greatwave1 6y ago
That quote isn't talking about wealth inequality, it's referencing concentration in corporate governance power. While funds like Vanguard are financed by investments from millions of people, the leaders of those funds control the voting power of all of their shares. This could cause anticompetitive behavior, when the same funds/holding companies have large stakes in all of the players within a given industry.
- deleted 6y ago
  [deleted]
- rckoepke 6y ago
  I really feel that Vanguard et. al should let votes be pass through. I'm sure there would be massive amounts of abstention but I don't see how that would be a problem per se.