To Trade or Not to Trade: The Strategic Trading of Insiders around News Announcements

We argue that insiders' decisions to trade in short windows before news announcements are likely to result from a trade-off between the incentives to capitalize on the foreknowledge of the disclosure and the risk of regulatory scrutiny and lost reputation. We provide evidence that insider buying is driven by the trade-off, while selling is primarily influenced by the deterring effect of the regulatory and reputation risks. We show that insiders strategically choose the amount of shares bought ahead of good news announcements. They increase their purchases as the price impact of the news goes up, but we find that the amount of shares purchased levels off as the news becomes extreme. In contrast, we find that the probability of insider selling significantly decreases with the price impact of the forthcoming bad news. To further support our arguments on the importance of incentives and disincentives to trade, we show that the strategic trading is mainly observed in the most price-sensitive groups of news announcements, it is clearly pronounced for best informed executives (CEOs), and that trading patterns change with changes in regulations, and insiders with higher reputation at risk limit their trading ahead of bad news.insider trading, private information, information disclosure, regulation

Why do Companies Include Warrants in Seasoned Equity Offerings: The case of French Unit Offerings.

We analyse the reasons why companies issue units when they raise additional capital. In contrast to previous evidence, our results show that units are not offered to mitigate the agency conflicts or to signal security mispricing as they are predominantly issued during cold periods, in public rather than in rights offerings, and when the issue is underwritten. In contrast, the results indicate that companies choose to offer units to circumvent the offer price regulation and to underprice their seasoned equity offering so as to minimise the issue cost and the risk of failure of the issue. These results provide support for the net proceeds maximization hypothesis.Warrants; Equity Issue; Flotation Method; Unit Offerings;

The Market Valuation of Share Repurchases in Europe

We analyze a uniquely constructed data set of open market share repurchases across a sample of European firms. We find that the announcement date market reaction is lower than that in the US, mainly because of (i) the relatively large number of recurring announcements which generate significantly lower returns than the initial announcements of intention to repurchase shares; (ii) the rather low market reaction in France, due probably to specific governance and corporate cultural issues; and (iii) the regulatory reform that allowed UK firms to keep the repurchased shares as treasury stock, which decreased their market impact. Across our countries, taxation, shareholder protection, and the European Union's Market Abuse Directive do not affect significantly the market valuation of repurchases. Our results imply that, ultimately, domestic institutional specificities and reforms play significant roles in the market valuation and popularity of share repurchases

The Pre-Kindergarten Learning Enterprise (PKLE)

To meet the challenges that today’s pre-Kindergarten children will face as adults, they need effective development and learning organizations. Together, those organizations form the pre-Kindergarten (pre-K) learning enterprise, whose characteristics and behaviors greatly influence what pre-K children learn and how well they learn it. In this paper, the pre-K learning enterprise is explicitly defined and modeled for the first time and then analyzed through a systems thinking lens using systemigrams and related causal loop diagrams. Defining and modeling the pre-K learning enterprise is itself valuable as a means to understand the various relationships that exist among the identified constituent systems (e.g., home environment, preschool, financial, health care, state, and government) and the stakeholders identified within the enterprise (e.g., parents, educators, health care providers, and policy makers). That value is enhanced through an analysis which reveals the predominant reliance of several key pre-K learning enterprise component systems on the financial system while exposing weak interactions among the three main participating systems (preschools, home environment, and government). Heavy reliance on the financial system in today’s economy reduces the effectiveness of the pre-K learning enterprise. To ease such reliance on the financial system while enhancing key interrelationships, three improvements to the existing enterprise are postulated: (1) enhance the role of parents through better education on child development, learning, health and nutrition and their increased voluntary involvement with preschools, (2) reduce the dependency on the financial system and promote partnerships among preschools, sports facilities, libraries and other learning systems to share resources, and (3) enhance government role through implementation of curriculum standardization, assessment and evaluation, and an effective policy towards mandatory education of low-income children

The information content of institutional trades on the London Stock Exchange

We construct a unique data set that includes all reported institutional block trades on the London Stock Exchange and analyze the market reaction to buy and sell trades. We find that the type of investors behind the trade and the combination of the trade's size and the trader's resulting level of ownership are the major determinants of the information effects and the asymmetry between price impacts of buy and sell trades. In particular, large trades undertaken by fund managers, the most active investors in our sample, have strong information content, while, for the remaining trades, we report limited support for the information and the price impact asymmetry hypotheses. These results hold even after accounting for trade complexity and volatility effects in the regressions

The Performance of Acquisitions by High Default Risk Bidders

We investigate the takeover strategies of high default risk acquirers and their value impact. We find that these bidders select bigger, less profitable and unrelated targets, pursue transactions during recessions, and pay with shares by offering target shareholders high premiums. Their long-term buy-and-hold returns are extremely negative, and reflect fundamentally their substantial drop in profitability combined with high leverage. We show that the well-established long-run underperformance of acquiring firms is largely driven by this sub-set of acquirers. The results are similar when we use alternative measures of default risk and performance, and a global sample of non-US bidders

Impact of Foreign Directors on Board Meeting Frequency

We find that UK firms are increasingly having fewer board meetings mainly because of the significant increase in the proportion of foreign non-executive directors on the board. The combination of low meetings frequency and the presence of foreign non-executive directors is correlated with lower total shareholder returns and increases the agency conflicts through excess compensations of the CEO and chairman, which are not related to firm value creation. Our results suggest that a trade-off between increased board diversity coupled with reduced monitoring through fewer meetings, weakens the internal governance mechanism, reduces the advisory role benefits of foreign non-executive directors who are likely to possess international expertise, and exacerbates significantly the agency conflicts

Genotypic study of Tunisian Arabian stallions

Diversity of Arabian stallions distributed throughout the territory of Tunisia has been evaluated. Seventeen microsatellite markers were used for the determination of genetic variation. A total of 95 alleles were detected in the 50 stallions studied. The number of alleles per locus ranged from 2 to 9 with an average of 5.6. The observed mean number of genetically diverse alleles (Na) was 5.6 (0.44). The mean number of expected alleles (Ne) was 3.42 (0.28). The average expected and observed heterozygosity was approximately 0.675 (0.026) and 0.593 (0.044), respectively. Principal component analysis showed the presence of 2 subpopulations in the studied sample set. These findings demonstrate the potential of microsatellites as a tool for designing and controlling animal breeds. Results show that the population under study has sufficient levels of genetic variations, which can be used as a foundation for developing plans for species conservation and long-term sustainability