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Insider trading patterns during the COVID period

Author

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  • Jiang, George J.
  • Ma, Xiaoli
  • Ma, Yun

Abstract

We investigate insider trading patterns during the COVID period and document distinct behaviors in purchases and sales. A significant increase in insider purchases occurred from late February to early April 2020, alongside a fourfold increase in insider sales throughout the year. We find a strong link between insider trading and market performance. Regression analysis shows that insiders act as contrarians, buying undervalued and selling overvalued stocks. This contrarian behavior is primarily driven by opportunistic insiders, while routine trades appear less responsive to past returns. Moreover, insider trading during the COVID period significantly predicts future stock returns, underscoring the enhanced informational content of insider activity during periods of extreme market uncertainty.

Suggested Citation

  • Jiang, George J. & Ma, Xiaoli & Ma, Yun, 2025. "Insider trading patterns during the COVID period," Pacific-Basin Finance Journal, Elsevier, vol. 94(C).
    • Handle: RePEc:eee:pacfin:v:94:y:2025:i:c:s0927538x2500294x
    DOI: 10.1016/j.pacfin.2025.102957
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    Full references (including those not matched with items on IDEAS)

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    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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