Insider trading and the post-earnings announcement drift

Christina Dargenidou, Ian Tonks, Fanis Tsoligkas

Research output: Contribution to journalArticle (Academic Journal)peer-review


We show that trades by corporate insiders after an earnings announcement determine in part the extent of the post‐earnings announcement drift anomaly. Contrarian trades mitigate the under‐reaction to earnings announcements, and confirmatory trades allow for price discovery with price movements continuing in the same direction as the earnings surprise. These results are consistent with insider trading being a mechanism that provides relevant information on transitory or permanent changes to the earnings process, allowing the market to make appropriate inferences about the nature of the earnings surprise.
Original languageEnglish
Pages (from-to)482-508
Number of pages27
JournalJournal of Business Finance and Accounting
Issue number3-4
Early online date1 Feb 2018
Publication statusPublished - 1 Mar 2018

Structured keywords

  • AF Financial Markets
  • AF Corporate Finance


  • earnings announcements
  • insider trading
  • market efficiency
  • market under‐reaction


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