Insider Sales under the Threat of Short Sellers: New Hypothesis and New Tests

• 成果类型: Article
• 署名作者: Wang, Kemin; Wang, Rencheng; Wei, K. C. John; Zhang, Bohui; Zhou, Yi
• 署名单位: Fudan University; Singapore Management University; Hong Kong Polytechnic University; The Chinese University of Hong Kong, Shenzhen
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/TAR-2018-0196
• 发表日期: 2022
• 页码: 427-451
• 关键词: CORPORATE GOVERNANCE; LITIGATION; earnings; INFORMATION; MARKET; STOCK; price; management; reputation; BEHAVIOR

摘要

Using the Regulation SHO program as a quasi-experiment, we document that the threat of short selling has a negative effect on the volume of opportunistic insider selling and a positive effect on its profitability for each transaction. These effects are stronger among firms with higher litigation risk, greater media coverage, and executives who have more of their firms' stock-related holdings. We further find robust evidence when we extend the analyses to short selling deregulations in the Chinese and Hong Kong stock exchanges. Overall, our findings suggest that short sellers play a disciplinary role in opportunistic insider selling.