Examines insider trading dynamics influenced by multiple firm affiliations, suggesting implications for trade informativeness.
This study examines trading by insiders with multiple firm affiliations by using a unique dataset related to insider tenure and firm connections. We analyze how transitioning from single to multiple affiliations influences trade outcomes and informativeness. Our findings reveal that while insider trades generally forecast future returns, trades by multi-firm insiders, particularly sales at incumbent firms paired with purchases at new ones, tend to be less informative and more related to liquidity/portfolio rebalancing motives. This study extends the literature on insider trading by highlighting the significance of multiple affiliations and trade timing in understanding transaction informativeness.
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Chao et al. (2026) studied this question.
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