IQ and corporate insiders’ decisions to time insider and outsider trading
Journal
European Financial Management
ISSN
1354-7798
Type
journal article
Date Issued
2021
Author(s)
Abstract (De)
We examine how corporate insiders’ cognitive ability (IQ) affects their decisions to time insider and outsider trading before abnormal stock price changes. Our analysis of archival data on male corporate insiders in Sweden shows they are less prone to time their insider selling and to sell in larger amounts, before abnormal stock price declines as IQ increases. We also find that insiders with a higher IQ are better at timing their outsider buying. Taken together, our results show that corporate insiders’ IQ affects their trading decisions differently, depending on whether they are trading in their insider or outsider stocks.
Language
English
HSG Classification
contribution to scientific community
Refereed
Yes
Volume
27
Number
5
Start page
814
End page
840
Official URL
Subject(s)
Division(s)
Eprints ID
265477