This paper demonstrates that hedge funds tend to design their activist campaigns to align with the preferences and ideologies of institutions holding large stakes in the target company. I estimate these preferences by analyzing the institutions' previous proxy voting behavior. The results reveal that activists benefit from this approach. Campaigns with a stronger positive correlation between the preferences of larger institutions and activist communications attract more shareholder attention, receive more votes, and are more likely to succeed.
Cite
@article{arxiv.2411.16553,
title = {Do Activists Align with Larger Mutual Funds?},
author = {Manish Jha},
journal= {arXiv preprint arXiv:2411.16553},
year = {2025}
}