I study the information content of corporate insiders' purchases when their firms experience sharp increases in short interest. Insider purchases mitigate the negative impact of short selling on stock prices, but this effect is temporary and reverts within one year. The cumulative abnormal...

By exploiting the exogenous reductions of analyst coverage due to closures and mergers of brokerage firms, I examine the causal impact of information asymmetry on insider trading. I find that corporate insiders' abnormal returns increase sharply after coverage reductions. This effect is stronger...