This paper attempts to determine the impact of the prudent man rule in a broader sense in the Korean Stock Market. Particularly, the study investigates patterns of institutional ownership of common stock. The interest is in determining factors that influence the investment choices of the institutional portfolio manager. The sample used here included 357 companies listed on the Korean Stock Market excluding financial institutions continuously between 1990 and 1999. The results show that institutional investors are concerned with the appearance of their portfolio and to avoid extreme ratios. For example, institutions avoid stocks with either a high or low beta, debt ratio, or return on assets.