There Insider Trading? An Examination of Merger and Acquisition Announcements in the Indonesia Stock Market  

Oleh:

Riyanto L.S., Bambang

Jenis: Article from Journal - ilmiah internasional - terdaftar di DIKTI
Dalam koleksi: The Indonesian Journal of Accounting Research (Jurnal Riset Akuntansi Indonesia) vol. 13 no. 2 (May 2010), page 133-148.
Topik: Domestic and Foreign Investors; Information Leakage; Insider Trading

Ketersediaan

Perpustakaan Pusat (Semanggi) Nomor Panggil: RR17.8 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

Lihat Detail Induk

Isi artikel

This research examine whether domestic investors reacted to merger and acquisition announcements earlier than the foreign investors. Compared to foreign investors, domestic investors are more familiar with the market environment and have more access to information about companies (i.e., there is information leakage). The domestic investors take this informational advantage by initiating trading activities before the information is made public. The foreign investors react companies, and some time they do not react immediately. This so-called insider trading phenomenon commonly happens in emerging markets. Two proxies of market reactions were used: abnormal returns and trading volume. Fifty-four M&A announcements were identified in the Jakarta Stock Exchange from 1999-2006. The price movement and trading activities of each of these two types of investors were analyzed thoroughly during the ninety-one day window test. The findings indicate that no abnormal returns and abnormal trading volumes were observed in the 91 days surrounding the announcement dates. Further findings, however, shows that there was information leakage for domestic investors. It is further argued that information leakage exists; domestic investors reacted M&A information before companies announced that information to the public.

Opini Anda

Klik untuk menuliskan opini Anda tentang koleksi ini!

Kembali