Insider Trading and Stock Market Prices in the Greek Technology Sector

Insider trading has been a major issue for stock markets and investor protection. In order to avoid problems of information asymmetry all countries have implemented regulations, forcing insiders to provide information concerning selling or purchasing shares of their firms. In this paper we examine the effect of these corporate announcements have on stock prices of companies in the Athens Stock Exchange technology sector, by using event study analysis methodology. 14 listed firms of the technology sector has been examined and a total of 636 announcements has been analysed. We found that purchasing transactions do not affect abnormal stock returns and stock prices, while selling transactions have a positive effect prior to the announcement and negative afterwards. The existence of a weak form of market efficiency can be assumed as announcements has not affected significantly and persistently stock prices and abnormal returns.