Insider Trading Before New Issue Announcements

Jonathan Karpoff () and Daniel Lee

Financial Management, 1991, vol. 20, issue 1

Abstract: On average, insiders are net sellers of their firms' common stock for several months before announcements of new common stock and convertible debt issues. There is no evidence of abnormal insider trading before announcements of straight debt issues. These results suggest that the prospect of legal and market penalties does not deter a significant amount of insider trading before new issue announcements, and are consistent with the hypothesis that managers have superior information that is conveyed to the market through new equity issues.

Date: 1991
References: Add references at CitEc
Citations: View citations in EconPapers (69)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fma:fmanag:karpoff91

Access Statistics for this article

Financial Management is currently edited by Bill Christie

More articles in Financial Management from Financial Management Association University of South Florida 4202 E. Fowler Ave. COBA #3331 Tampa, FL 33620. Contact information at EDIRC.
Bibliographic data for series maintained by Courtney Connors ( this e-mail address is bad, please contact ).