In 1984, Ivan Boesky purchased 1.7 million shares of Carnation's stock on the basis of illegally obtained insider information. The events and data allow testing of the impact of informed trading on share prices and market liquidity. A positive and significant relation is found between Boesky's trades and stock price changes, but bid/ask spreads were not significantly affected. Bid and ask depths were either unaffected or improved by his trades.
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Chakravarty et al. (1997) studied this question.
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