Research On Insider Trading In China 's Listed Companies

With the equity system reform and the implementation of the modified company law and securities law, the insider trading in the stock market became a legal action. Because of the special identity, relative to the outside investors, corporate insiders have an advantage in congenital information, they always know some very important information of the company before the market, this advantage will bring their excess returns again. Market full of controversy for insider trading, therefore, the focus is whether insider trading really has the "legitimacy", insiders will use its information advantage to get excess profits. This dispute has caused the attention of the securities regulators, in order to regulate the behavior of insider trading, the China securities regulatory commission, the shenzhen stock exchange, the Shanghai stock exchange and other relevant regulators to formulate a series of laws and regulations. But the illegal insider tradings often happen, to crack down on illegal insider trading, we have to fundamentally understand the present situation of insider trading, and insider trading profits. This paper will try to do the reseach like this.To guarantee the feasibility of the reaeach, we narrow the scope of insider trading, insider trading is only refers to the sale of the company stock trading of the directors, supervisors and senior managers of listed companies in the secondary market. We make the 2012-2014 within three years’ insider trading of the shenzhen market of listed companies as research samples, analyze the present situation of our country listed company insider trading, insider trading and statistical violations, found serious phenomena of insider trading, but the relevant agencies to investigate and punish, punish strength is lower. Then we try to use the event analysis to reseach excess earnings of insider trading, we confirmed that insiders sell stock trading has a strong ability of timing, can get excess returns, but when making buying stocks trading did not exhibit strong timing fits.Based on the disclosed insider trading sample data of the shenzhen stock exchange, we comprehensively analyse the present situation of our country listed company insider trading and illegal transactions, then confirmed that the insider selling has a strong ability of timing, they can get excess returns,but insiders buying trading will get a little excess return, especially within a short period after insiders buying, insider trading and other illegal tradings will happen. The conclusion has a certain significance for the external investors and securities regulators to regulate the behavior of insider trading, even avoid illegal insider trading.