Speculation or Insider Trading: Informed Trading in Options Markets Preceding Tender Offer Announcements

2000 ◽  
Author(s):  
Tom Arnold ◽  
Gayle R. Erwin ◽  
Lance A. Nail ◽  
Ted Bos
Keyword(s):  
Insider Trading ◽  
Informed Trading ◽  
Options Markets ◽  
Tender Offer

scholarly journals Insider Trading after Repurchase Tender Offer Announcements: Timing versus Informed Trading

2010 ◽  
Vol 39 (1) ◽  
pp. 301-322 ◽  
Author(s):  
Henock Louis ◽  
Amy X. Sun ◽  
Hal White
Keyword(s):  
Insider Trading ◽  
Informed Trading ◽  
Tender Offer

scholarly journals Insider Trading After Repurchase Tender Offer Announcements: Timing versus Informed Trading

2008 ◽  
Author(s):  
Henock Louis ◽  
Amy X. Sun ◽  
Hal D. White
Keyword(s):  
Insider Trading ◽  
Informed Trading ◽  
Tender Offer

Bidder Incentives for Informed Trading before Hostile Tender Offer Announcements

1994 ◽  
Vol 23 (4) ◽  
pp. 57 ◽  
Author(s):  
Devra L. Golbe ◽  
Mary S. Schranz
Keyword(s):  
Informed Trading ◽  
Tender Offer

Informed trading around merger and acquisition announcements: Evidence from the UK equity and options markets

2010 ◽  
Vol 31 (8) ◽  
pp. 703-726 ◽  
Author(s):  
Spyros Spyrou ◽  
Andrianos Tsekrekos ◽  
Georgia Siougle
Keyword(s):  
Merger And Acquisition ◽  
Informed Trading ◽  
Options Markets ◽  
Acquisition Announcements ◽  
The Uk

scholarly journals Do Proxies for Informed Trading Measure Informed Trading? Evidence from Illegal Insider Trades

2020 ◽  
Vol 10 (3) ◽  
pp. 397-440 ◽  
Author(s):  
Kenneth R Ahern
Keyword(s):  
Insider Trading ◽  
Sampling Bias ◽  
Informed Trading ◽  
Cross Sectional ◽  
Order Imbalance ◽  
Oxford University ◽  
Insider Trades ◽  
Editorial Decision ◽  
New Evidence ◽  
Bid Ask Spreads

Abstract This paper exploits hand-collected data on illegal insider trades to provide new evidence on the ability of a host of standard measures of illiquidity to detect informed trading. Controlling for unobserved cross-sectional and time-series variation, sampling bias, and strategic timing of insider trades, I find that when information is short-lived, only absolute order imbalance and effective spread are statistically and economically robust predictors of illegal insider trading. However, when information is long-lasting, insiders strategically time their trades to avoid illiquidity, and none of the standard measures considered are reliable predictors, including bid-ask spreads, order imbalance, Kyle’s λ, and Amihud illiquidity. (JEL D53D82G12G14K42) Received: March 14, 2019; Editorial decision: February 18, 2020 by Editor Thierry Foucault. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

Informed Trading Surrounding Data Breaches in Options Markets

2019 ◽  
Author(s):  
Louis R. Piccotti ◽  
Heng Wang
Keyword(s):  
Informed Trading ◽  
Options Markets ◽  
Data Breaches

scholarly journals Detecting Informed Trading Activities in the Options Markets

2012 ◽  
Author(s):  
Marc Chesney ◽  
Remo Crameri ◽  
Loriano Mancini
Keyword(s):  
Informed Trading ◽  
Options Markets ◽  
Trading Activities

scholarly journals A probabilidade de negociação com informação privilegiada no mercado acionário brasileiro

2013 ◽  
Vol 11 (2) ◽  
pp. 249
Author(s):  
Orleans Silva Martins ◽  
Edilson Paulo
Keyword(s):  
Corporate Governance ◽  
Information Asymmetry ◽  
Insider Trading ◽  
Voting Rights ◽  
Informed Trading ◽  
Common Stocks ◽  
Level 1 ◽  
Probability Of Informed Trading ◽  
The Relationship ◽  
Level 2

This paper aims to investigate the existence of insider trading in the Brazilian stock market. For this, we estimate the probability of informed trading (PIN) of 229 stocks during the years 2010 and 2011, using the model of Easley <i>et al.</i> (2002). In the results, it was found that the average PIN of these stocks was 24.9%, suggesting the existence of informed trading in that period. Considering the segment of corporate governance, the stocks listed on Level 2 had the lowest average PIN (24.4%), while stocks on Level 1 had the highest average (25.6%). Considering the classes of stock, the average PIN of common stocks was 24.2% and the average PIN of preferred stocks was 26.0%, indicating that the stocks with voting rights had lower information asymmetry. Still, it was found that the relationship between greater and lesser liquidity PIN was only confirmed for common stocks with high liquidity.

Informed Options Trading Prior to Takeover Announcements: Insider Trading?

2019 ◽  
Vol 65 (12) ◽  
pp. 5697-5720 ◽  
Author(s):  
Patrick Augustin ◽  
Menachem Brenner ◽  
Marti G. Subrahmanyam
Keyword(s):  
Stock Market ◽  
Insider Trading ◽  
Informed Trading ◽  
Securities And Exchange Commission ◽  
Equity Options ◽  
Corporate Insiders ◽  
Beneficial Ownership ◽  
Options Trading ◽  
Option Volume ◽  
The U.S

We quantify the pervasiveness of informed trading activity in target companies’ equity options before the announcements of 1,859 U.S. takeovers between 1996 and 2012. About 25% of all takeovers have positive abnormal volumes, which are greater for short-dated, out-of-the-money calls, consistent with bullish directional trading before the announcement. Over half of this abnormal activity is unlikely due to speculation, news and rumors, trading by corporate insiders, leakage in the stock market, deal predictability, or beneficial ownership filings by activist investors. We also examine the characteristics of option trades litigated by the Securities and Exchange Commission (SEC) for alleged illegal insider trading. Although the characteristics of such trades closely resemble the patterns of abnormal option volume in the U.S. takeover sample, we find that the SEC litigates only about 8% of all deals in it. This paper was accepted by Lauren Cohen, finance.

scholarly journals Detecting Informed Trading Activities in the Options Markets: Appendix on Subprime Financial Crisis

2012 ◽  
Author(s):  
Marc Chesney ◽  
Remo Crameri ◽  
Loriano Mancini
Keyword(s):  
Financial Crisis ◽  
Informed Trading ◽  
Options Markets ◽  
Trading Activities
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