Federal Reserve System, June 2000.         value of "human capital"-the value of the earnings potential of the work force.) In con- trast, Table 1.2 includes financial assets such as bank accounts, corporate equity, bonds, and mortgages. Persons in the United States tend to hold their financial claims in an indirect form. In fact, only about one-quarter of the adult U.S. population holds shares directly. The claims of most individuals on firms are mediated through institutions that hold shares on their be- half: institutional investors such as pension funds, insurance companies, mutual funds, and endowment funds. Table 1.3 shows that today approximately half of all U.S. equity is held by institutional investors. I. Introduction 1. The Investment Environment The McGraw−Hill Companies, 2001           CHAPTER 1 The Investment Environment 5     Table 1.3 Holdings of Corporate Equities in the United States   Share Ownership, Percent of Sector Billions of Dollars Total   Private pension funds $ 2,211.9 13.8% State and local pension funds 1,801.4 11.3 Insurance companies 993.6 6.2 Mutual and closed-end funds 2,740.9 17.1 Bank personal trusts 295.6 1.8 Foreign investors 1,168.1 7.3 Households and non-profit organizations 6,599.2 41.2 Other 197.6 1.2