Research on Insider Trading Based on Sentiment Analysis of Annual Reports

Yu Qi ()
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Yu Qi: University of Sydney, Business Master of Commerce

A chapter in Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022), 2022, pp 522-526 from Springer

Abstract: Abstract Along with the split share structure reform, the phenomenon of insider trading was born. In addition, with the continuous improvement of our country's laws, insider trading has increased year by year, and its impact on the capital market cannot be ignored. This paper takes the number of insider transactions before the annual report of the year as the research object, studies the impact of annual report sentiment on insider transactions and analyses whether insiders have information advantages. The results of the study show that when listed companies release positive news, insider trading increases significantly, while for bad news, insider trading is less. This is since insiders in my country follow the “timed trading theory” before the earnings announcement. The success of the above research can not only make up for the vacancy of domestic A-share insider trading, but also improve the current research direction of insider trading information advantages and lay the foundation for further research on insider trading in the future.

Keywords: Sentiment Analysis; Insider trading; Information advantage (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-036-7_77

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DOI: 10.2991/978-94-6463-036-7_77

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