• DOI:10.1111/J.1540-6288.1998.TB01379.X
Corpus ID: 153735921

Insider Trading and the Bid-Ask Spread

@article{Chung1998InsiderTA,
  title={Insider Trading and the Bid-Ask Spread},
  author={K. Chung and C. Charoenwong},
  journal={The Financial Review},
  year={1998},
  volume={33},
  pages={1-20}
}

K. Chung, C. Charoenwong

Published 1998

Business

The Financial Review

This study examines the intertemporal and cross-sectional association between the bid-ask spread and insider trading. Empirical results from the cross-sectional regression analysis reveal that market makers establish larger spreads for stocks with a greater extent of insider trading. The time-series regression analysis, however, finds no evidence of spread changes on insider trading days. These results suggest that although market makers may not be able to detect insider trading when it occurs… CONTINUE READING

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