However, our research shows that tracking peer group ownership may be of little practical use. In a comprehensive study, we found that the vast majority of investors do not concentrate holdings in peer groups. Once you look at the level where investment decisions are made, the apparent aggregations disappear.
Industry selectively has nothing to do with it.
Demand for peer targeting is fueled in part by companies' desire to gain investors at their peers' expense just as they desire greater market share, or their disbelief that an investor could find a peer more attractive. In some corners, support for peer targeting is fueled by the willingness of investment managers that have a large investment in a peer to meet with XYZ Company management. Their presumed interest in XYZ Company should be taken with a grain of salt, however. XYZ management is a terrific source of information on their existing investment. However, because the alleged peer concentrations are a myth, peer targeting is almost always a waste of time.