Characteristics And Detection Of Insider Trading In China's Securities Market

As the main stock market illegal activities, Insider trading not only seriously disturbed the normal order of securities market, but left the basic functions of the securities market could not work effectively. From a view of the market functions, insider trading not only distorted the market price of the actual value of the reaction, but also undermined the stock market's resource allocation and other functions. From a view of the international competitiveness, insider trading impacted the construction of the market environment and may weaken a country's attractiveness on international securities markets. From a view of the market efficiency, insider trading weakened the confidence for market, increased the market volatility, even in extreme cases may lead market to crash.Based on the views of national researchers, the article pooled analysis of insider information and insider trading behavior of insiders, and defined the elements that constitute the theory of insider trading. At the same time, the article described and explained the existing prohibition against insider trading regulations. Put together the insider trading, executive compensation, ownership structure, large shareholders dumping and the value of a company, the article shows the impact on corporate governance. Analysis and description of insider trading of listed companies and the status of corporate governance, the article offers five characteristics and explains. Finally, the article selected theInsider trading penalty of 35 samples and 35 control samples by China Securities Regulatory Commission since 1993, used neural network technology to model. The model which could transfer a nonlinear relationship to data in neural network trained samples, and then was used to test another batch of new samples. As a result, it is possible to identify insider trading by the neural network technology.