According to the Investment Company Institute (ICI) total U.S. mutual fund assets were just under $10 trillion at the end of 2008, accounting for just over half of the $19 trillion global mutual fund industry. It's also estimated that current assets invested in hedge funds amounts to more than $1.4 trillion; since most hedge funds use significant leverage, that figure understates hedge funds' influence in global markets.
 
In short: Institutional investors such as mutual or hedge funds dominate trading volumes in global stock markets. Even a small move in these investors' exposure can mean billions of dollars shifting into favored stocks and sectors. And rising institutional buying interest means rising share prices.

Large-capitalization stocks like ExxonMobil (NYSE: XOM), Intel (Nasdaq: INTC) and Walmart (NYSE: WMT) dominate the portfolios of most mutual funds. So changes in relatively large investments in these widely held stocks won't have much of an impact on price. But investors who can spot rising institutional interest in smaller, lesser-known firms stand to make outsized gains as a flood of cash from institutional players buoys shares over time.

Among the easiest ways to spot rising institutional interest: surging trading volume. Volume is nothing more than a measure of how many shares of stock change hands every day. Since institutional players control so much cash, they typically buy stocks in large blocks of shares -- this buying interest shows up in the form of rising volume. Since buying a large position at one time would attract attention and result in a big jump in the stock's price, institutional players tend to accumulate and sell shares steadily over several weeks or months.

Of course, one-day spikes in trading volume can be caused by news events, key earnings releases or a single large trader entering or exiting a stock. To smooth out such one-off events, investors should look for a steady, consistent rise in volume over a lengthy period of time. This is a strong sign that institutions are making a move with the stock.

Keep in mind that not every stock is going to be impacted by institutional investors, even if it is seeing rising volume. As a rule of thumb, most institutional investors largely avoid stocks with low share prices, market capitalizations under $500 million or with trading volumes under 500,000 shares a day. Since they control such large bankrolls, moving in and out of smaller or thinly traded stocks distorts the share price too much.

With these points in mind, I recently scoured our extensive database in search of stocks seeing growing institutional interest by using the following criteria:

• Price greater than $10 per share.
• market capitalization greater than $500 million
• Positive return over past 6 months
• Average 30-day trading volume greater than average 3-month trading volume
• Average 3-month trading volume greater than average 6-month trading volume
• Price/earnings-to-growth (PEG less than 1.5

Here are the top results of this screen, based on total returns:

As expressed with their rising value and rising volume over the past six months, these particular stocks seem have have strong institutional interest supporting them. This list should serve as a great starting point for further research.