scholarly journals Is insider trading regulation effective? Evidence from UK takeover activity

2012 ◽  
Vol 1 (2) ◽  
pp. 24-48
Author(s):  
Brendan Lambe

Analysed in this study are the returns on stock prices of target companies surrounding the first publicised dates of completed takeovers in the UK between 2001 and 2010. Two samples are created of 209 and 197 firms for announcement and rumoured dates respectively. Both demonstrate statistically significant cumulative abnormal returns (CARs) prior to the release of information about the impending bid. This paper investigates whether observable factors create this price run-up or if it is the result of disclosed insider trading. Cross sectional analysis of CARs do not corroborate the claim that reported informed trades are the cause of this effect, this may indicate that trading on material non public information goes undisclosed.

2016 ◽  
Vol 24 (3) ◽  
pp. 248-267
Author(s):  
Brendan John Lambe

Purpose The purpose of this paper is to ascertain the efficacy of Financial Services and Markets Act (FMSA) (2000) in deterring illegal insider trading in target companies around the time of a merger and aquisition announcement. Design/methodology/approach The author uses an event study to measure the cumulative average abnormal returns (CAARs) around both the announcement and rumour date for a sample of UK takeovers between 2001 and 2010. Findings Statistically significant CAARs prior to the event date are observed across the sample. Research limitations/implications It is not possible to link unknown instances of illegal insider trading with pre takeover residuals, therefore explaining the residuals remains a deductive process. Practical implications Pre-event abnormal returns may indicate that trading on material nonpublic information is still a contributory factor in the run-up proportion of takeover premiums. Social implications This draws a question over the efficacy of the regulatory system. Originality/value This study provides evidence which points to insider trading activity ahead of Mergers in a post FMSA 200 UK context.


2009 ◽  
Vol 73 (4) ◽  
pp. 44-63 ◽  
Author(s):  
Michael A. Wiles ◽  
Anna Danielova

As a result of the diminishing effectiveness of broadcast advertising, firms are increasingly turning to product placements in films and television to promote their products. A growing stream of product placement research has conducted surveys of consumer and practitioner views on the practice and experiments to gauge product placement's impact on brand awareness, attitudes, and purchase intent. However, there is no evidence of whether firms’ investments in film product placements are worthwhile. The event study of 126 product placements in successful films during 2002 reveals a mean cumulative abnormal return of .89% during the film's opening, indicating that product placement in a successful film is associated with positive movements in firm stock prices. Cross-sectional analysis of the returns offers new insight into how product, film, and execution factors influence the placement's worth. The authors find that placement abnormal returns are enhanced by tie-in advertising and brand equity but are inhibited by audience absorption, critical acclaim, and violent film content. Placement modality, character associations, and blatancy also significantly affect the placement's value.


Author(s):  
Eirini Dimakakou ◽  
Helinor J. Johnston ◽  
George Streftaris ◽  
John W. Cherrie

Human exposure to particulate air pollution (e.g., PM2.5) can lead to adverse health effects, with compelling evidence that it can increase morbidity and mortality from respiratory and cardiovascular disease. More recently, there has also been evidence that long-term environmental exposure to particulate air pollution is associated with type-2 diabetes mellitus (T2DM) and dementia. There are many occupations that may expose workers to airborne particles and that some exposures in the workplace are very similar to environmental particulate pollution. We conducted a cross-sectional analysis of the UK Biobank cohort to verify the association between environmental particulate air pollution (PM2.5) exposure and T2DM and dementia, and to investigate if occupational exposure to particulates that are similar to those found in environmental air pollution could increase the odds of developing these diseases. The UK Biobank dataset comprises of over 500,000 participants from all over the UK. Environmental exposure variables were used from the UK Biobank. To estimate occupational exposure both the UK Biobank’s data and information from a job exposure matrix, specifically developed for UK Biobank (Airborne Chemical Exposure–Job Exposure Matrix (ACE JEM)), were used. The outcome measures were participants with T2DM and dementia. In appropriately adjusted models, environmental exposure to PM2.5 was associated with an odds ratio (OR) of 1.02 (95% CI 1.00 to 1.03) per unit exposure for developing T2DM, while PM2.5 was associated with an odds ratio of 1.06 (95% CI 0.96 to 1.16) per unit exposure for developing dementia. These environmental results align with existing findings in the published literature. Five occupational exposures (dust, fumes, diesel, mineral, and biological dust in the most recent job estimated with the ACE JEM) were investigated and the risks for most exposures for T2DM and for all the exposures for dementia were not significantly increased in the adjusted models. This was confirmed in a subgroup of participants where a full occupational history was available allowed an estimate of workplace exposures. However, when not adjusting for gender, some of the associations become significant, which suggests that there might be a bias between the occupational assessments for men and women. The results of the present study do not provide clear evidence of an association between occupational exposure to particulate matter and T2DM or dementia.


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