Are corporate managers savvy about their stock price? Evidence from insider trading after earnings announcements

abstract

• We find that insiders trade as if they exploit market underreaction to earnings news, buying (selling) after good (bad) earnings announcements when the price reaction to the announcement is low (high). We also find that insider trades attributable to public information about earnings and the price reaction generate abnormal returns. By demonstrating that managers spot market underreaction to earnings news, our results imply that managers are savvy about their company's stock price. 2009.

authors

• Kolasinski, Adam

published proceedings

• Journal of Accounting and Public Policy

author list (cited authors)

• Kolasinski, A., & Li, X. u.

citation count

• 25

complete list of authors

• Kolasinski, Adam||Li, Xu

publication date

• January 2010

publisher

• Elsevier  Publisher

published in

• Journal of Accounting and Public Policy  Journal

Digital Object Identifier (DOI)

• 10.1016/j.jaccpubpol.2009.10.004

start page

• 27

end page

• 44

volume

• 29

issue

• 1

URL

• http://dx.doi.org/10.1016/j.jaccpubpol.2009.10.004