Tools
Tools
Le, VP, Nguyen, AN and Gregoriou, A (2022) Insider trading, gender diversity within the board room, CEO pay gap, and stock price crash risk. International Journal of Finance and Economics, 29 (2). pp. 1378-1400. ISSN 1076-9307
|
Text
Insider trading, gender diversity within the board room, CEO pay gap, and stock price crash risk.pdf - Published Version Available under License Creative Commons Attribution. Download (3MB) | Preview |
Abstract
This paper investigates the impact of insider trading and managerial attributes on future stock price crashes. We conduct a series of regressions addressing the managerial attributes determinants of future stock price crashes including gender diversity, CEO age, and CEO power (measured by CEO pay disparity, CEO tenure and CEO duality). Our empirical results reveal a positive association between insider purchases and price crash risk. This implies that other than compensation and career concerns, insiders hoard bad news to fulfil their trading incentives. Our positive coefficients of insider sales also suggest that insider sellers can assess inside information promptly and anticipate shortly before the crashes. We further document that the presence of female directors on boards can mitigate stock price crash risk. However, firms with powerful or younger Chief Executive Officers are more likely to experience crashes. Overall, we highlight the importance of corporate managerial attributes in dealing with information asymmetry problems.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | 1502 Banking, Finance and Investment; Economics |
| Subjects: | H Social Sciences > HF Commerce > HF5001 Business |
| Divisions: | Liverpool Business School |
| Publisher: | Wiley |
| SWORD Depositor: | A Symplectic |
| Date Deposited: | 01 Jul 2024 10:38 |
| Last Modified: | 01 Jul 2024 13:24 |
| DOI or ID number: | 10.1002/ijfe.2731 |
| URI: | https://researchonline.ljmu.ac.uk/id/eprint/23669 |
 |
View Item |