{"title":"Opportunistic Insider Trading During the COVID-19 Pandemic","authors":"Bijoy Chandra Das","doi":"10.1111/fmii.12213","DOIUrl":null,"url":null,"abstract":"<p>This paper examines whether opportunistic or routine insiders in US markets engage in informed trading and earn higher short-term returns during the COVID-19 pandemic. Our findings indicate that trades by opportunistic insiders are indeed informative, yielding higher returns compared to those of routine insiders during the pandemic. Interestingly, we also observe that opportunistic directors earn higher returns than CEOs. Additionally, opportunistic insiders trading in the Nasdaq market achieve higher returns compared to those in the NYSE, and opportunistic insiders in the financial sector outperform those in the non-financial sector. Our results remain robust across various model specifications, alternative measures and considerations for endogeneity. Overall, our findings suggest that opportunistic insiders possess a significant informational advantage, enabling them to engage in informed trading during the pandemic.</p>","PeriodicalId":39670,"journal":{"name":"Financial Markets, Institutions and Instruments","volume":"34 3","pages":"131-149"},"PeriodicalIF":0.0000,"publicationDate":"2025-04-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/fmii.12213","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Financial Markets, Institutions and Instruments","FirstCategoryId":"1085","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/fmii.12213","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"Economics, Econometrics and Finance","Score":null,"Total":0}
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Abstract
This paper examines whether opportunistic or routine insiders in US markets engage in informed trading and earn higher short-term returns during the COVID-19 pandemic. Our findings indicate that trades by opportunistic insiders are indeed informative, yielding higher returns compared to those of routine insiders during the pandemic. Interestingly, we also observe that opportunistic directors earn higher returns than CEOs. Additionally, opportunistic insiders trading in the Nasdaq market achieve higher returns compared to those in the NYSE, and opportunistic insiders in the financial sector outperform those in the non-financial sector. Our results remain robust across various model specifications, alternative measures and considerations for endogeneity. Overall, our findings suggest that opportunistic insiders possess a significant informational advantage, enabling them to engage in informed trading during the pandemic.
期刊介绍：
Financial Markets, Institutions and Instruments bridges the gap between the academic and professional finance communities. With contributions from leading academics, as well as practitioners from organizations such as the SEC and the Federal Reserve, the journal is equally relevant to both groups. Each issue is devoted to a single topic, which is examined in depth, and a special fifth issue is published annually highlighting the most significant developments in money and banking, derivative securities, corporate finance, and fixed-income securities.
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