Is 'Not-Trading' Informative? Evidence from Corporate Insiders' Portfolios

Persistent Link:
http://hdl.handle.net/10150/613156
Title:
Is 'Not-Trading' Informative? Evidence from Corporate Insiders' Portfolios
Author:
DeVault, Luke
Issue Date:
2016
Publisher:
The University of Arizona.
Rights:
Copyright © is held by the author. Digital access to this material is made possible by the University Libraries, University of Arizona. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.
Abstract:
Some corporate insiders hold insider equity holdings in multiple companies (portfolio insiders). I hypothesize that information can be garnered not only from their trades (e.g., an insider sale of firm A on day t), but from their not-traded securities (e.g. the insider's decision not to sell firms B and C on day t). Specifically, an insider's decision not to sell (purchase) security B at the time of the sale (purchase) of security A, is a positive (negative) signal for security B, the not-sold (not-bought) security. The paper presents three major empirical findings. First, portfolio insider not-sold securities following a sale earn large risk-adjusted returns outperforming the not-purchased securities following a purchase. Second, portfolio insiders' purchases are more informative than single-firm insiders' purchases. Finally, the results suggest that abnormal returns associated with insider purchases result from markets reacting to the revelation of the insider purchase while abnormal returns associated with not-sold securities appear to result from insiders delaying sales prior to positive firm-specific events.
Type:
text; Electronic Dissertation
Keywords:
market efficiency; private information; Management; insider trading
Degree Name:
Ph.D.
Degree Level:
doctoral
Degree Program:
Graduate College; Management
Degree Grantor:
University of Arizona
Advisor:
Sias, Richard

Full metadata record

DC FieldValue Language
dc.language.isoen_USen
dc.titleIs 'Not-Trading' Informative? Evidence from Corporate Insiders' Portfoliosen_US
dc.creatorDeVault, Lukeen
dc.contributor.authorDeVault, Lukeen
dc.date.issued2016-
dc.publisherThe University of Arizona.en
dc.rightsCopyright © is held by the author. Digital access to this material is made possible by the University Libraries, University of Arizona. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.en
dc.description.abstractSome corporate insiders hold insider equity holdings in multiple companies (portfolio insiders). I hypothesize that information can be garnered not only from their trades (e.g., an insider sale of firm A on day t), but from their not-traded securities (e.g. the insider's decision not to sell firms B and C on day t). Specifically, an insider's decision not to sell (purchase) security B at the time of the sale (purchase) of security A, is a positive (negative) signal for security B, the not-sold (not-bought) security. The paper presents three major empirical findings. First, portfolio insider not-sold securities following a sale earn large risk-adjusted returns outperforming the not-purchased securities following a purchase. Second, portfolio insiders' purchases are more informative than single-firm insiders' purchases. Finally, the results suggest that abnormal returns associated with insider purchases result from markets reacting to the revelation of the insider purchase while abnormal returns associated with not-sold securities appear to result from insiders delaying sales prior to positive firm-specific events.en
dc.typetexten
dc.typeElectronic Dissertationen
dc.subjectmarket efficiencyen
dc.subjectprivate informationen
dc.subjectManagementen
dc.subjectinsider tradingen
thesis.degree.namePh.D.en
thesis.degree.leveldoctoralen
thesis.degree.disciplineGraduate Collegeen
thesis.degree.disciplineManagementen
thesis.degree.grantorUniversity of Arizonaen
dc.contributor.advisorSias, Richarden
dc.contributor.committeememberKahle, Kathleenen
dc.contributor.committeememberCederburg, Scotten
dc.contributor.committeememberWoutersen, Tiemenen
dc.contributor.committeememberSias, Richarden
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