An institutional investor is an investor who trades for their own account or for the account of others in large enough quantities to qualify as an institutional investor. What's the benefit of being an institutional investor, you ask? They don't receive the same level of protection by the U.S. government as individual investors do. Still, due to their institutional status institutional investors are better able to effect exempt transactions and often receive better treatment from brokerage houses due to the large size of their orders. Size does matter, it seems.