An Empirical Study On The Factors Of Insider Trading In Stock Market In China

Insider dealing is an issue not only old but also realistic, the pursuit of profit in capital market causes this issue to emerge in an endless stream,it is the most headache problem to every capital market. China’s Securities Regulatory Commission makes heavy effort to hit market manipulate,insider dealing and connected transaction.After the use of big-data system from the second half of2013,CSRC investigated375inside dealings and put on record142items, an increase of21%and33%to the January of2015.The economy development of our country has stepped into the era of new normal,the information of merger and reorganization about public company is quite active,insiders make use of these messages to make profit,which makes insider tradings happen frequently.The research of this issue is realistic and provides a new vision to reinforce supervise.The past research focus on qualitative investigation,the quantitative study of insider trading grows only in current years,the theoretical framework remains to be improved.Insider trading factors study is poor,existing study focuses on law factors,the quantitative index measurement is lacking.To investigate the main factors of insider dealing,this article chooses97administrative punishment cases from2006June to2013August,including assets reorganization,mergers and acquisitions,major matters,high dividend and performance information,and uses PIN model of EKOP to measure the degree of insider trading before the public of important information.This article uses Pearson correlation test to measure the correlativity,apply multiple regression to test internal controls,IDII,senior holding,institution holding,law factors’effects on PIN.Meanwhile,size and profit index are added into the regression to replace other variables to carry on the stability test.The result implies that these variables affect PIN notably,the quantitative relationship in regression is notable.Apart from the above,this article elaborate the viewpoint of macro-insider dealing,we should not only focus on micro-insider dealing,but also regulate macro-insider dealing.In the end,some policy suggetsions are put forward,including public company internal controls,the regulation of insitutional investors,the construction of system of information disclosure and law setting&execution.