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Insider Trading at Zagreb Stock Exchange

Author

Listed:
  • Kuveždić Marko

    (Prolaz Jurja Ratkaja 5, 10000 Zagreb, Croatia,+385 97 708 8547)

  • Dedi Lidija

    (Faculty of Economics and Business, University of Zagreb, Zagreb, Croatia.)

Abstract

This paper is the first paper that systematically observes and describes all publicly available data on insider trading on the Zagreb Stock Exchange during the period of June 2010 - June 2021. To accomplish this objective both parametric and non-parametric event-study tests are conducted using the data collected from 827 notifications published on the Zagreb Stock Exchange website. After filtering the notifications for overlapping events, there were 48 insiders’ purchase events and 50 insiders’ sales events. The results indicate that insiders can earn abnormal returns on share purchases based on their insider knowledge and that the information on insider purchases can bring additional information to outside investors. However, in the case of notifications of share sales by insiders, Cumulative Average Abnormal Returns (CAARs) after the event are not statistically significant and are just slightly positive, thus bringing no abnormal returns for insiders and not conveying information to the public. This suggests that the market may perceive sales having a lower informational content, as motivation for sales may be other needs, such as liquidity.

Suggested Citation

  • Kuveždić Marko & Dedi Lidija, 2022. "Insider Trading at Zagreb Stock Exchange," Zagreb International Review of Economics and Business, Sciendo, vol. 25(1), pages 79-94.
    • Handle: RePEc:vrs:zirebs:v:25:y:2022:i:1:p:79-94:n:1005
    DOI: 10.2478/zireb-2022-0006
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    More about this item

    Keywords

    event study; abnormal return; insider trading; Zagreb Stock Exchange;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General

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