Insider Trading in the Swiss Stock Market
Swiss Journal of Economics and Statistics, Vol. 143, No. 3, pp. 331-362, 2007
Posted: 6 Feb 2008
The scope of offences that qualify as illegal insider trading is rather narrow in Switzerland compared to other countries. Therefore we investigate abnormal returns associated with management transactions in the Swiss stock market. We find that abnormal returns of insiders are concentrated on small firms. Trading volume affects the magnitude of abnormal returns. Evidence for the stealth trading hypothesis in the Swiss stock market is found. Furthermore, our results show that clustered transactions do not reject stronger insider beliefs. We find no evidence for insiders exploiting news announcements. Finally, only outsiders who mimic small-volume transactions of insiders can earn abnormal returns.
Keywords: Insider trading, management transactions, Switzerland, abnormal returns, event study
JEL Classification: G14
Suggested Citation: Suggested Citation