We take a closer look at the question of whether dual traders in futures markets are indeed informed traders. Underpinning this question is the intuition that a dual trader's decision to trade on his own account is not random, but is endogenously determined by his expectations of trading profits...

Using proprietary audit trail transaction data compiled by the Commodity Futures Trading Commission, we investigate, at the individual trader level, (1) the timing and (2) the determinants of dual traders' personal trades. Our analysis reveals an absence of any trade timing by dual traders in...