Insider Trading Following Material News Events: Evidence from Earnings

摘要: 0 Prior studies indicate that insider buying (selling) activity precedes positive (negative) abnormal returns persist over relatively long horizons.1 Presumably, investors may benefit from knowledge of previous trades, and consistent with this, the financial press investment advisors frequently provide information on trading activity.2 Recent efforts to reduce incidence based non-public have originated both regulatory authorities companies. Congress has passed several new laws regulating in past decade, SEC increased its enforcement restrictions (see Arshadi Eyssell [2, pp. 31-2]). Several companies also adopted policies restrict time periods following news events such as quarterly earnings announcements. For instance, Compaq a policy limits transactions period reports "Heavy Insider Sales are Made at Compaq," The Wall Street Journal, June 9, 1993).3 intended effect is presumably "level playing field" between insiders external ensure firm officers comply law.