Listed Companies’ Geographical Distribution Feature And Its Relation With Institutional Investors’ Stock-holding Preference

China is a country with vast territory and abundant resources, in which natural resources and economic resources are unevenly distributed. Combined with policy factor and other conditions, China presents the east, central and west economic regions, leading to uneven distribution of listed companies in the three regions. Listed companies have become a significant part of China’s economic system. The healthy and even development of listed companies is quite important to China’s economy. However, there are more listed companies in the east than that in the central and west, which would widen the economic development gap between regions. Researches show that institutional investors could effectively improve listed companies’governance and performance and play an important role in listed companies’healthy development. Along with the development of security market and supportive policies, institutional investors catch more and more attentions. Institutional investors have their own investment preferences. Is it affected by listed companies’geographical distribution? If so, the gap between regions’ economic development would be further widened, which is harmful to balanced development of China’s economy, especially in the backward area in the central and the west. Therefore, this article analyzes and concludes the geographical distribution feature of China’s listed companies, and explores the relation of listed companies’distribution and institutional investors’preference.First, this article reviews the domestic and overseas literatures from two perspectives of listed companies’ distribution and institutional investors’ preferences, and finds that there are several articles researching on the relation of geographical factor and institutional investors’ preferences, but little articles on the relation of listed companies’distribution and institutional investors’preferences in China. Second, this article conducts statistical analysis on the current situation of China’s listed companies’ distribution in the east, central and west regions to explore the distribution feature, and analyzes the relationship between location feature and institutional investors preference. Then, this article conducts descriptive analysis, variance analysis, correlation analysis and linear regression of listed companies’distribution and institutional investors’ preferences in the empirical analysis. This article selects A-share listed companies up to2009as research sample, in which the statistic of institutional investors’preferences covers three years from2010to2012. Listed companies’ distribution is measured in three ways——the east-central-west regions, whether it is provincial capitals, municipality directly under the Central Government or municipalities with independent planning status, and the rank of urban competitiveness. Besides, this article also researches the relationship between the area and institutional investors’ preference under the moderating effect of city and performance.Through theoretical analysis and empirical analysis, this article finds that there is significant difference in China’s listed companies’ distribution. Uneven development in regions is the important factor that affecting the level of listed companies’ development. Institutional investors’ share proportion is significantly different in the east, central and west regions, and that of the east listed companies is significantly higher than that of the west listed companies, but there is no significant difference between institutional investors’ share proportion of the east listed companies and that of the central listed companies. As a whole, institutional investors’ average share proportion is decreasing progressively from east to west. Provincial capital, municipality directly under the central government and cities under separate state planning, and city competitiveness index has a significant positive influence on institutional investors holding. However, the capital city, municipality directly under the central government and cities under separate state planning, the rank of urban competitiveness and listed companies performance factors will weaken the effect that east-central-west regions play on institutional investors holding preference.