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Do Social Networks Facilitate Informed Option Trading? Evidence from Alumni Reunion Networks
Cheong, Harvey; Kim, Joon Ho; Münkel, Florian; Spilker … - 2021
Material private information transmits through social networks. Using manually collected information on networks of alumni reunion cohorts, we show that hedge fund managers connected to directors of firms engaged in merger deals increase call option holdings on target firms before deal...
Persistent link: https://www.econbiz.de/10013243492
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Introducing a spread into the Kyle model
Salomonsson, Marcus - 2009
The Kyle (1985) model is extended to take into account market maker competition and the spread. It is shown that with a … spread the Kyle model has a Nash equilibrium also with two market makers, not only with three or more, as shown in earlier … research. The spread is endogenized, and two testable predictions of the model are generated. The first is that the spread is …
Persistent link: https://www.econbiz.de/10010281344
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Introducing a spread into the Kyle model
Salomonsson, Marcus - Economics Institute for Research (SIR), … - 2009
The Kyle (1985) model is extended to take into account market maker competition and the spread. It is shown that with a … spread the Kyle model has a Nash equilibrium also with two market makers, not only with three or more, as shown in earlier … research. The spread is endogenized, and two testable predictions of the model are generated. The first is that the spread is …
Persistent link: https://www.econbiz.de/10005649280
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Are Corporate Spin-Offs Prone to Insider Trading?
Augustin, Patrick - 2020
Despite abundant empirical evidence of informed trading ahead of major corporate events, no such evidence has been reported in the case of corporate spinoff (SP) announcements. This is surprising, as SP announcements are unexpected, and are also associated with a positive price jump in the...
Persistent link: https://www.econbiz.de/10012856345
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Institutional Ownership and Insider Trading : Quasi-Experimental Evidence
Hillegeist, Stephen A. - 2018
We examine the causal effect of institutional ownership on insider trading using a regression discontinuity design to analyze exogenous differences in institutional ownership around Russell Index reconstitutions. Our findings indicate institutional investors influence insider trading behavior....
Persistent link: https://www.econbiz.de/10012911656
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Internal Control Over Financial Reporting and Managerial Rent Extraction : Evidence from the Profitability of Insider Trading
Skaife, Hollis Ashbaugh; Veenman, David; Wangerin, Daniel - 2013
This paper examines the association between ineffective internal control over financial reporting and the profitability of insider trading. We predict and find that the profitability of insider trading is significantly greater in firms disclosing material weaknesses in internal control relative...
Persistent link: https://www.econbiz.de/10014177566
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Quasi-Indexer Ownership and Insider Trading : Evidence from Russell Index Reconstitutions
Hillegeist, Stephen A.; Weng, Liwei - 2021
Understanding the association between quasi-indexer ownership and insider trading is important given the externalities that insider trading can impose on shareholders, the importance of quasi-indexers in the capital markets, and their mixed monitoring incentives. The prior literature has...
Persistent link: https://www.econbiz.de/10013229885
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Insider Trading Based on Overconfidence of CEO and CFO
Demirkan, Sebahattin; Felix, Robert; Muslu, Volkan - 2022
Through close interactions with their CEO and CFO, independent directors as well as subordinate executives can assess the overconfidence of their CEO and CFO. We show that independent directors and subordinate executives trade on this assessment, albeit differently. Independent directors of a...
Persistent link: https://www.econbiz.de/10013403355
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Dynamic q-theory with agency investment frictions and cross-sectional stock returns
Mao, Lei; Mao, Mike Qinghao; Wei, K. C. John - 2015 - Last revised: 26 Jan 2016
We investigate the impact of managerial investment diversion on a firm's investment paths and the investment-return relation in a dynamic q-theory model. When efficiency of investment is not observed by shareholders, the manager may divert investment for private benefits. An agency investment...
Persistent link: https://www.econbiz.de/10011659514
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Do Synergies Exist in Related Acquisitions? A Meta-Analysis of Acquisition Studies
Homberg, Fabian - 2009
Mergers and Acquisitions (Mamp;A) aim to increase wealth for shareholders of the acquiring company, in particular by creating synergies. It is often assumed that relatedness is a source of synergies. Our study distinguishes between business, cultural, technological and size relatedness. It...
Persistent link: https://www.econbiz.de/10012720658