Award Winning
Journal Article
This paper examines the effect of introducing insider trading restrictions on the behaviour of the Amsterdam Stock Exchange. From 1987 on, insiders are no longer allowed to trade two months before an annual earnings announcement. The results indicate that stocks became less liquid (when liquidity is measured by trading volume) when insiders were not allowed to trade. The authors also find some evidence that the introduction of insider trading restrictions reduced the stock markets speed of adjustment to positive earnings news.
Faculty
Emeritus Professor of Finance