The insider trading policy is an aspect of a firm's internal governance which ensures corporate transparency is maintained and promotes investor confidence. We examine the effect of trading policies on the returns to trades conducted by corporate insiders in a period where the adoption of a...

This paper investigates whether corporate insiders trade when asymmetric information is high, using data on U.S. corporate insider transactions between 1986 and 2012. The key innovation of this paper is our proxy for asymmetric information relivol which measures deviations of idiosyncratic...

In this paper I examine the relationship between credit rating and insider trading of 301 firms from 2000-2006 for S&P 500 Index firms. I argue that changes to the firm credit rating may increase (decrease) informed trading activities. This investigation is essential since insiders with private...

We examine whether foreign investors play a role in mitigating opportunistic insider trading. Using a novel global insider trading dataset containing 35,557 firms from 26 countries, we find that greater foreign institutional ownership significantly reduces insider trading profitability, above...

We examine whether shareholder litigation deters informed insider trading, utilizing the staggered adoptions of Universal Demand (UD) laws by different states. The UD laws substantially raise the hurdle for shareholders to file derivative litigation. We find that corporate insiders significantly...

We study whether firms that voluntarily restrict insider trading have lower incentives for earnings management. Using a large sample of US firms, we measure these restrictions based on the extent to which insider transactions happen shortly after quarterly earnings announcements. We find that...

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...

We examine corporate insider transactions around Sarbanes-Oxley §403 (SOX) regulatory regimes and subsequent Wall Street Journal (WSJ) media postings — and provide new evidence on the benefit/cost trade-off tension between private information transfer and stock trading costs. SOX increased...

These slides summarize a paper on opportunism by corporate insiders. We show that opportunistic insiders can be identified through the profitability of their trades prior to quarterly earnings announcements (QEAs), and that opportunistic trading is associated with various kinds of...

We examine insider trading profitability and common identity between insiders and top executives. In particular, we argue that common gender and the resultant social connections it creates influence access to private information, where insiders benefit from greater information sharing with top...