Type:

Bachelor Thesis Business Administration

Status:

completed

Tutor:

Jens Heckmann, M.Sc.

Examiner:

• Prof. Dr. Heiko Jacobs

Abstract

Company insiders have different motivations for trading their own stocks. This might be due to liquidity needs or their compensation structure but can also be motivated by exploiting non-public information. There are several approaches to determine whether a trade is information-driven or not. This work should focus on the connection between trading patterns and the information content of insider trades by analyzing the causal effect on profitability.

• Cohen, L., C. Malloy, & L. Pomorski (2012): Decoding Inside Information.  Journal of Finance Vol. 67 (3), pp. 1009 - 1043.   
• Hong, C. Y., & F. W. Li (2019): The Information Content of Sudden Insider Silence. Journal of Financial and Quantitative Analysis Vol 54 (4), pp. 1499–1538.

Original Abstract:

Company insiders have different motivations for trading their own stocks. This might be due to liquidity needs or their compensation structure but can also be motivated by exploiting non-public information. There are several approaches to determine whether a trade is information-driven or not. This work should focus on the connection between trading patterns and the information content of insider trades by analyzing the causal effect on profitability.

• Cohen, L., C. Malloy, & L. Pomorski (2012): Decoding Inside Information.  Journal of Finance Vol. 67 (3), pp. 1009 - 1043.   
• Hong, C. Y., & F. W. Li (2019): The Information Content of Sudden Insider Silence. Journal of Financial and Quantitative Analysis Vol 54 (4), pp. 1499–1538.