Strategic trading and trade reporting by corporate insiders

André Betzer, Jasmin Gider, Daniel Metzger and Erik Theissen

No 2011/04, CFS Working Paper Series from Center for Financial Studies (CFS)

Abstract: Regulations in the pre-Sarbanes-Oxley era allowed corporate insiders considerable flexibility in strategically timing their trades and SEC filings, for example, by executing several trades and reporting them jointly after the last trade. We document that even these lax reporting requirements were frequently violated and that the strategic timing of trades and reports was common. Event study abnormal re-turns are larger after reports of strategic insider trades than after reports of otherwise similar nonstrategic trades. Our results also imply that delayed reporting is detrimental to market efficiency and lend strong support to the more stringent trade reporting requirements established by the Sarbanes-Oxley Act.

Keywords: Insider Trading; Directors' Dealings; Corporate Governance; Market Efficiency (search for similar items in EconPapers)
JEL-codes: G14 G30 G32 (search for similar items in EconPapers)
Date: 2011
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https://www.econstor.eu/bitstream/10419/57346/1/645939757.pdf (application/pdf)

Related works:
Working Paper: Strategic Trading and Trade Reporting by Corporate Insiders (2011)
Working Paper: Strategic trading and trade reporting by corporate insiders (2010)
Working Paper: Strategic trading and trade reporting by corporate insiders (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cfswop:201104

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