Informed traders: Linking legal insider trading and share repurchases
Journal
Financial Analysts Journal
Journal Volume
68
Journal Issue
1
Pages
60-73
Date Issued
2012
Author(s)
Abstract
Logic suggests that a link might exist between insider trades and share repurchases because of their potential to signal mispricing when market prices deviate from fair value; both events emanate from essentially the same set of decision makers. Using the overall repurchase sample, adding insider- trading information is generally not helpful. For "value" bui/back companies, however; where perceived mispricing may be a more important factor, insider trading provides a strong complement to the repurchase signal. ? 2014 Institute.
Type
journal article