Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/29162
Title: The information content of insider trading around seasoned equity offerings
Authors: Ching, KML
Firth, M
Rui, OM
Keywords: Insider trading
Placings
Rights offerings
Issue Date: 2006
Publisher: North-Holland
Source: Pacific basin finance journal, 2006, v. 14, no. 1, p. 91-117 How to cite?
Journal: Pacific basin finance journal 
Abstract: This paper examines insider trading around seasoned equity offering (SEO) announcements in Hong Kong. The announcements of private placings (rights offerings) are associated with positive (negative) abnormal stock returns. However, longer-term stock returns are negative for both private placings and rights offerings. In general, insiders are net purchasers in placing firms in the 6 months prior to and 6 months subsequent to the SEO, whereas insiders are net sellers in rights issue firms in the 6 months prior to and 6 months subsequentto the issue. The net purchases made by the insiders of firms making placements help them maintain their control rights, which are otherwise diluted by the placements. Insider trading does not explain longer-term investment returns.
URI: http://hdl.handle.net/10397/29162
ISSN: 0927-538X
DOI: 10.1016/j.pacfin.2005.07.002
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