Journal Article Optimal Investment and Technical Progress Get access S. Chakravarty S. Chakravarty Delhi University Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 31, Issue 3, June 1964, Pages 203–206, https://doi.org/10.2307/2295909 Published: 01 June 1964

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Using audit trail data for a sample of NYSE firms we show that medium-size trades are associated with a disproportionately large cumulative stock price change relative to their proportion of all trades and volume. This result is consistent with the predictions of Barclay and Warner's (1993) stealth-trading hypothesis. We find that the source of this disproportionately large cumulative price impact of medium-size trades is trades initiated by institutions. This result is robust to various sensitivity checks. Our findings appear to confirm street lore that institutions are informed traders.