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Examine the accompanying figure which presents cumulative abnormal returns both before and after dates on which insiders buy or sell shares in their firms How do you interpret this figure

  1. Examine the accompanying figure, which presents cumulative abnormal returns both before and after dates on which insiders buy or sell shares in their firms. How do you interpret this figure? What are we to make of the pattern of CARs before and after the event date? (LO 8-3)

    Cumulative daily average prediction errors (%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Source: Reprinted from Nejat H. Seyhun, “Insiders, Profits, Costs of Trading and Market Efficiency,”

www.mhhe.com/bkm

Journal of Financial Economics 16 pp. 189–212, copyright June 1986, with permission from Elsevier.

 

 

 

 

 

Jun 17 2020 View more View Less

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