Trading strategies of corporate insiders


Klein, Olga ; Maug, Ernst ; Schneider, Christoph



DOI: https://doi.org/10.1016/j.finmar.2017.04.001
URL: https://www.sciencedirect.com/science/article/pii/...
Additional URL: https://papers.ssrn.com/sol3/papers.cfm?abstract_i...
Document Type: Article
Year of publication: 2017
The title of a journal, publication series: Journal of Financial Markets
Volume: 34
Issue number: June
Page range: 48-68
Place of publication: Amsterdam [u.a.]
Publishing house: Elsevier
ISSN: 1386-4181
Publication language: English
Institution: Business School > ABWL u. Corporate Finance (Maug)
Subject: 330 Economics
Abstract: We test two complementary theories of optimal trading strategies by analyzing the transaction patterns of corporate insiders. According to information-based theories, investors trade faster if they compete with others for exploiting the same information, while liquidity-based theories predict the opposite. Our analysis supports the predictions of liquidity-based models: insiders take longer to complete trades when they face competition from other insiders and they trade slower in less liquid markets. Insiders adapt to fluctuations in market liquidity. We identify informed trading using CARs, company news announcements, and insider trading patterns. Our results support the predictions of information-based models for informed trades.

Dieser Eintrag ist Teil der Universitätsbibliographie.




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