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  • Cited by 5
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    This article has been cited by the following publications. This list is generated based on data provided by CrossRef.

    Duong, Lien and Evans, John 2015. CFO compensation: Evidence from Australia. Pacific-Basin Finance Journal, Vol. 35, p. 425.

    Hillier, David Korczak, Adriana and Korczak, Piotr 2015. The impact of personal attributes on corporate insider trading. Journal of Corporate Finance, Vol. 30, p. 150.

    Ozkan, Aydin and Trzeciakiewicz, Agnieszka 2014. Informative content of insider purchases: evidence from the financial crisis. Review of Behavioural Finance, Vol. 6, Issue. 1, p. 26.

    S. Knewtson, Heather and R. Nofsinger, John 2014. Why are CFO insider trades more informative?. Managerial Finance, Vol. 40, Issue. 2, p. 157.

    Wang, Weimin and (Frank) Wang, Xu 2014. Predicting earnings in a poor information environment. Journal of Contemporary Accounting & Economics, Vol. 10, Issue. 1, p. 46.

  • Journal of Financial and Quantitative Analysis, Volume 47, Issue 4
  • August 2012, pp. 743-762

Are CFOs’ Trades More Informative Than CEOs’ Trades?

  • Weimin Wang (a1), Yong-Chul Shin (a2) and Bill B. Francis (a3)
  • DOI:
  • Published online: 01 April 2012

We investigate whether trades made by chief financial officers (CFOs) reveal more information about future stock returns than those by chief executive officers (CEOs). We find that CFOs earn statistically and economically higher abnormal returns following their purchases of company shares than CEOs. During 1992–2002, CFOs earned an average 12-month excess return that is 5% higher than that by CEOs. The superior performance by CFOs occurs notwithstanding controls for risk factors and persists even after their trades are publicly disclosed. Further analysis shows that CFO purchases are associated with more positive future earnings surprises than CEO purchases, suggesting that CFOs incorporate better information about future earnings.

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Journal of Financial and Quantitative Analysis
  • ISSN: 0022-1090
  • EISSN: 1756-6916
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