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Stock Prices and the Secondary Dissemination of Information: The Wall Street Journal's “Insider Trading Spotlight”Column
Author(s) -
Chang Saeyoung,
Suk David Y.
Publication year - 1998
Publication title -
financial review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.621
H-Index - 47
eISSN - 1540-6288
pISSN - 0732-8516
DOI - 10.1111/j.1540-6288.1998.tb01386.x
Subject(s) - insider trading , insider , stock (firearms) , business , commission , public information , stock exchange , stock price , event study , monetary economics , stock market , financial economics , economics , finance , political science , law , public relations , biology , history , paleontology , context (archaeology) , archaeology , series (stratigraphy) , horse
In this paper we test whether a secondary dissemination of information affects stock prices. We examine stock price reactions to the publication of the “Insider Trading Spotlight”(ITS) column in the Wall Street Journal (WSJ) . Since insider trades reported in the ITS column are initially disclosed to the public when insiders’ reports are filed with the Securities and Exchange Commission (SEC), the information contained in the WSJ is a secondary dissemination. Around the WSJ publication day, we find significant abnormal stock performance accompanied by a significant increase in trading volume. Our evidence suggests that a secondary dissemination of information can affect stock prices if the initial public disclosure attracts only limited attention by the market. In addition, we document how insider trading information is conveyed to the market.