Next, in order to control for other possible effects, we estimated the cross-sectional relation between TDAR and institutional ownership by estimating weighted least squares (WLS) regressions of the form:
The results reported in Exhibits 2 and 3 documenting a positive relation between TDAR and the level of institutional ownership are consistent with the effective-monitoring hypothesis.
We do, however, find a significant positive relation between AFR and TDAR.
The positive relation between LTAFR and TDAR indicates that equity issue announcements convey information regarding long-term earnings also.
We find a significant positive relation between both TDAR and LTAFR with institutional ownership for the low-q group only.