We investigate the prevalence of informed options trading prior to takeover announcements, when the legal prohibition against insider trading is strictest. Although insider trading laws apply equally to the options and stock markets, the options market is considerably more transparent than the...

We examine how options trading affects voluntary corporate disclosure to explore how managers strategically disclose in light of potential managerial learning from the options market. We find that options trading reduces the likelihood and frequency of management earnings forecasts, suggesting...

We examine how options trading affects voluntary corporate disclosure, so that we can shed light on whether managers’ potential learning from the options market induces them to withhold disclosure. We find that options trading reduces the likelihood and frequency of management earnings...