When brokers, analysts, and fund managers buy or sell stocks for their own accounts, these “access employees” of financial institutions outperform retail investors over short windows up to a month. They earn particularly high abnormal returns when they trade before earnings announcements, revisions of analyst recommendations, and large stock price changes. We also find evidence consistent with profitable front-running and information leakage around the execution of corporate insider trades and block trades by mutual funds, as well as the release of revised recommendations by analysts who work at the same brokerage firm.

This paper investigates whether the personal trading decisions of CEOs are related to their corporate acquisition decisions. We find that the personal trading performance of CEOs across all stocks they trade is significantly and positively related to the short-term performance of their mergers, and that CEOs exhibiting greater turnover on their personal common equity portfolios undertake acquisitions more frequently. Hence, a CEO's risk aversion, confidence and capability are consistent across their personal and corporate investment decisions.

This study uncovers how household investors intensify the effect of the 52-week high (52WH): increased volume and momentum-like returns at the 52WH price. Using daily household and institutional trading data, we find that households sharply increase their selling, particularly with limit orders at the 52WH price. This behavior is indicative of anchoring, as it is robust to past returns and intensified by proximity, market uncertainty, and salience of the 52WH. This uninformed limit order selling at and prior to the 52WH leads to a doubling of unconditional 52WH anomaly returns. Post-event returns benefit institutions, which act as counterparties.

Analysis of shareholdings reveals that corporate directors generate positive alpha when they hold board interlocked stocks, where they are not an insider but a current co-board member is. In contrast, directors do not outperform when they hold inside stocks or other stocks unconnected to the board network. Analysis of trades shows that directors outperform when they buy or sell their own company's stock as insiders. They also outperform when they buy interlocked stocks. Results are similar for trades made before firm-specific information events. We also find limited support for the hypothesis that industry familiarity improves performance.

This paper examines whether the trading activity of different investor types, institutional versus retail, can affect the relation between beta and average returns. We find that the beta-return relation is strong and positive on days with high institutional trading activity, and negative and significant on low institutional trading days. Our findings are robust and not driven by recently documented effects such as macroeconomic news and leverage constraints, among others. The evidence is consistent with the hypothesis that the preferences and characteristics of various investor types, which are revealed through their trading activity, cause the slope of the Security Market Line to change.