We examine insider trading surrounding takeover rumors in a sample of 1,642 publicly traded U.S. firms. Using difference-in-differences regressions, we find that insider net purchases increase within the year prior to the first publication of a takeover rumor, particularly when rumor articles...

In this paper we examine institutional trading in proximity to takeover rumors by combining the ANcerno dataset of transaction-level institutional trades with a unique sample of takeover rumor ‘scoops’. We find that institutions are net buyers in firms which subsequently become subject to...

We examine derivatives trading prior to takeover rumors in a sample of 1,638 publicly traded U.S. firms. The volume of options traded is abnormally high over the 5-day pre-rumor period, primarily due to the number of out-of-the-money call options traded. In addition, the direction of option...