Overview
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Institutional Investor vs. Retail Investor
An institutional investor is a company or organization that trades securities in large enough quantities to qualify for preferential treatment from brokerages and lower fees. Institutional investors do not use their own money, but rather, they invest the money of others on their behalf.
A retail investor is an individual or non-professional investor who buys and sells securities through brokerage firms or retirement accounts like 401(k)s. Retail investors are investing for themselves, often in brokerage or retirement accounts.
The differences between institutional and retail investors relate to costs, investment opportunities, and access to investment insight and research.
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