Institutional trading and satellite data

This study investigates the impact of satellite data availability on the market timing abilities of institutional investors. By analyzing the introduction of satellite coverage for major retailers, this study finds that access to satellite data significantly enhances the return predictability of daily institutional trading. This improvement is more pronounced for stocks with severe information asymmetry and is driven by non-hedge funds. These results suggest that institutions, especially non-hedge funds, actively adjust their trading positions on a daily basis in response to satellite data. • Access to satellite data significantly enhances the return predictability of daily institutional trading • The enhanced return predictability persists for at least three months, though it gradually weakens over time. • This improvement is more pronounced for stocks with high information asymmetry and appears to be primarily driven by non-hedge funds.