Insider trading and information asymmetry: Evidence from the Korea Exchange

Doojin Ryu; Heejin Yang; Jinyoung Yu

doi:10.1016/j.ememar.2021.100847

Insider trading and information asymmetry: Evidence from the Korea Exchange

Doojin Ryu
, Heejin Yang
, Jinyoung Yu

Department of Economics

Research output: Contribution to journal › Article › peer-review

20 Scopus citations

Abstract

This study examines whether pre-announcement insider trading significantly resolves or intensifies information asymmetry in the Korean emerging stock market. Local institutions are the most informed and trade in the right direction before analyst report announcements. Such insider trading increases post-announcement information asymmetry or adverse selection costs. Notably, local retail investors' trading behavior synchronizes with that of local institutions after pre-announcement insider trading.

Original language	English
Article number	100847
Journal	Emerging Markets Review
Volume	51
DOIs	https://doi.org/10.1016/j.ememar.2021.100847
State	Published - Jun 2022

Keywords

Adverse selection
Analyst report
Difference-in-differences
Emerging stock market
Information asymmetry
Insider trading

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10.1016/j.ememar.2021.100847

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title = "Insider trading and information asymmetry: Evidence from the Korea Exchange",

abstract = "This study examines whether pre-announcement insider trading significantly resolves or intensifies information asymmetry in the Korean emerging stock market. Local institutions are the most informed and trade in the right direction before analyst report announcements. Such insider trading increases post-announcement information asymmetry or adverse selection costs. Notably, local retail investors' trading behavior synchronizes with that of local institutions after pre-announcement insider trading.",

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author = "Doojin Ryu and Heejin Yang and Jinyoung Yu",

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KW - Analyst report

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KW - Information asymmetry

KW - Insider trading

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Insider trading and information asymmetry: Evidence from the Korea Exchange

Abstract

Keywords

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