CHAPTER 11
The Challenges of Managing Large-Cap Common Stock Portfolios
Just as there are a number of challenges in managing small-capitalization stock portfolios, there are a number of challenges in managing large-capitalization stock portfolios. In general, some of the more mechanical issues that small-capitalization stock portfolios face are irrelevant in the case of large-cap portfolios. Liquidity is generally less of an issue when it comes to purchases and sales. In addition, one generally is not faced with the agency issues that accompany control positions in public companies. When a portfolio manager charged with managing a very large small-capitalization stock portfolio is purchasing outstanding shares of a company, a position size that ...
