Qin Lei, Murli Rajan and Xuewu Wang
The purpose of this paper is to conduct an empirical analysis of the trading performance of US corporate insiders.
Abstract
Purpose
The purpose of this paper is to conduct an empirical analysis of the trading performance of US corporate insiders.
Design/methodology/approach
Based on the volume weighted average price (VWAP), the authors propose a metric to measure the trading performance of US corporate insiders: trading alpha. This metric is clean of the contamination effect from insiders' own trades. The authors apply this metric to examine whether insiders can beat the market when they trade.
Findings
It is found that corporate insiders achieve positive trading alpha on both purchases and sales of stocks on average. The existence of a positive trading alpha is robust to controlling for firm, trading and insider characteristics. More importantly, evidence is found for the persistence in corporate insiders' trading performance. Those insiders who traded well in the past continue to trade well over time. Those who well execute in purchases of stocks also perform well in sales.
Originality/value
This paper extends the notion of beating the market from the investment profession to the trading profession. Skyrocketing corporate insider trades provide a natural setting under which to examine the trading performance. The findings that: insiders can beat the market on average when they trade; and there exists persistence in the insiders' trading performance over time and along trading directions are novel and new to the literature. This paper also has bearing on how to evaluate professional traders.
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Qin Lei and Xuewu Wang
The purpose of this paper is to provide some rational perspectives for the flight‐to‐liquidity event rather than simply attributing it to the change in investor sentiment.
Abstract
Purpose
The purpose of this paper is to provide some rational perspectives for the flight‐to‐liquidity event rather than simply attributing it to the change in investor sentiment.
Design/methodology/approach
The paper builds a model to highlight the inherent difference in investors' investment horizon, and thus their sensitivity to changes in transaction costs in the stock and bond markets. When stock market deterioration results in higher trading costs, the existing marginal investor shifts wealth to bonds instead of remaining indifferent between stocks and bonds. At the new equilibrium, there is a higher fraction of bond ownership and a longer average investment horizon among stock holders. The paper then empirically tests the model predictions using data in the US stock and bond markets.
Findings
The authors find evidence strongly supporting this paper's theoretical predictions. Days with high stock illiquidity, high stock volatility and low stock return are associated with high yield spread in the bond market. This contemporaneous linkage between the stock market and the bond market is even stronger during periods with strong net outflows from stock mutual funds and strong net inflows to money market funds. The paper also demonstrates the existence of a maturity pattern that the predicted effects, especially the effects of stock illiquidity, are much stronger over shorter maturities.
Originality/value
The finding of this model that the investment horizon of the marginal investor (and thus the equilibrium price impact in the bond market) responds to changes in market conditions contributes to the theoretical debate on whether transaction costs matter. The flow evidence strengthens our understanding of the asset pricing implications of portfolio rebalancing decisions, and the maturity effect bolsters the case for flights to liquidity/quality due to heterogeneity in investment horizon without resorting to investor irrationality or behavioral attributes. In fact, it is arguably difficult to reconcile with a behavioral explanation.
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Qin Lei, Murli Rajan and Xuewu Wang
The purpose of this paper is to investigate how insiders’ trades are executed and whether and how outside investors can mimic outperforming insiders and reap substantial portfolio…
Abstract
Purpose
The purpose of this paper is to investigate how insiders’ trades are executed and whether and how outside investors can mimic outperforming insiders and reap substantial portfolio returns that withstand the erosion from adjustments for both the standard factors and stock characteristics in the asset pricing literature.
Design/methodology/approach
The authors design a metric for measuring insiders’ trade execution quality: the trading alpha. The authors run regression analysis to control for trade difficulty, insider reputations and the corporate role ranks of insiders and document the existence of the abnormal trading alpha. The authors further form portfolios based on the abnormal trading alpha and document a significant abnormal return that is robust to both standard asset pricing factors model and the stock characteristics adjustments.
Findings
Outperforming insiders at the aggregate level resemble value investors who trade on long-term fundamental information, trade patiently and earn rents from providing liquidity. Outside investors can mimic the outperforming insiders and reap significant abnormal portfolio returns.
Research limitations/implications
Data limitations on insider trades and their association/interaction with their brokers prevent us from having a conclusive investigation of the trading skill hypothesis. The authors hope to further research along the lines of the trading skill hypothesis as compared to investment style hypothesis with more detailed data about the brokers used by insiders.
Practical implications
The findings can be applied for money management profession in that outsider investors can monitor the trading execution and construct portfolios based on the adjusted abnormal trading alpha. The resulting portfolio has been documented to be highly profitable after risk adjustments using standard asset pricing factors as well as stock characteristics.
Social implications
Professional money managers and outsider investors should be able to benefit from the findings in this paper and use the proposed trading alpha metric to construct and rebalance real-time investment portfolios.
Originality/value
Outperforming insiders at the aggregate level resemble value investors who act on long-term fundamental information, trade patiently and earn rents from providing liquidity. From the perspective of investment implications, outside investors can mimic the outperforming insiders and reap substantial portfolio returns that withstand the erosion from adjustments for both the standard factors and stock characteristics in the asset pricing literature.
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Abstract
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This paper aims to examine how the law may play a role in mediation by paying special attention to how the law is excluded from and included in the process of court mediation in…
Abstract
Purpose
This paper aims to examine how the law may play a role in mediation by paying special attention to how the law is excluded from and included in the process of court mediation in China.
Design/methodology/approach
Hundred model court mediation cases selected by the Supreme People’s Court of China were analysed and reviewed.
Findings
The law is relevant in Chinese-style court mediation in four ways: first, judge-mediators are intended to use mediation to avoid resolving legal difficulties or challenges; second, judge-mediators consult the law to anticipate the losing party and the potential negative effects that might result from the adjudication; third, judge-mediators refer to the law to propose a mediation scheme or plan to guide the parties to settle; and fourth, judge-mediators would use the law as a bargaining chip in various ways to induce the parties to settle.
Research limitations/implications
Standards should be set out for the use of law in the mediation process to standardise judge-mediators’ actions, to ensure that the law is not used coercively to push settlement, which would undermine the parties’ self-determination in mediation.
Originality/value
This paper provides an original understanding of how law affects the process, the outcomes and, ultimately, the nature of settlements that parties achieve through court mediation in China. This study contributes to the literature that argues that ethical norms and legal standards should be set to direct those legal evaluations.
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Ren Hong, Zhang Zhengtong, Ma Xianrui and Tang Xilai
In the face of solving the urban traffic congestion problem radically, emphasis has been laid on the research on slow traffic planning of urban built environment. Hence, research…
Abstract
In the face of solving the urban traffic congestion problem radically, emphasis has been laid on the research on slow traffic planning of urban built environment. Hence, research on slow traffic demand forecasting can provide a basis for the planning of urban slow traffic systems. Based on land use, the overall planning of the new Guangming (GM) district, and the population prediction results, the slow traffic demand within the scope of the new district was forecasted by combining the per capita trip frequency, and the spatial distribution of the slow traffic flow of the new GM district was forecasted per the forecasted demand quantity for slow traffic. The following research conclusions were obtained. Within the new GM district, the correlation of the total demand for slow traffic with the land use functions and population distribution was high, and the cross-zone traffic was mainly decided by the land usage of this district. The cross-unit slow traffic flow was concentrated in the Gongming central, Guangming central, high-tech zone, and Yutian zones. This research provides a guideline for the layout of slow traffic facilities in the future.
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Sandriane Pizato, Raquel Costa Chevalier, Marcela Félix Dos Santos, Tailine Saturnino Da Costa, Rosalinda Arévalo Pinedo and William Renzo Cortez Vega
The purpose of this paper is to evaluate the shelf-life of minimally processed pineapple when subjected to the use of different edible coatings.
Abstract
Purpose
The purpose of this paper is to evaluate the shelf-life of minimally processed pineapple when subjected to the use of different edible coatings.
Design/methodology/approach
The pineapples were peeled and cut into cubes. The gums were prepared by dissolving them in distilled water and then heated to total dissolution. After calcium chloride, citric acid and ascorbic acid and glycerol were added in the solutions. The pieces of pineapple were completely submerged in the respective solutions and then drained. Four treatments were obtained, namely: T1 – control treatment (pineapple without coating); T2 – pectin; T3 – tara; T4 – xanthan. The cubes were stored in PET by 12 days at 4±1°C. Analyzes were carried out of mass loss, pH, titratable acidity, soluble solids, microbiological and sensory analysis.
Findings
It was possible to observe that the use of evaluated coatings was efficient to maintain the conservation of minimally processed pineapple in all analyzes, when compared with the control sample. The treatment with tara gum showed the best results to those obtained by the other studied gums.
Practical implications
The study may help small-scale establishments to increase the shelf-life of minimally processed pineapple.
Originality/value
Tara gum reduced the mass loss, delayed the microbial growth and maintained the sensorial quality of minimally processed pineapples for a longer time.
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Xiaoliang Qian, Jing Li, Jianwei Zhang, Wenhao Zhang, Weichao Yue, Qing-E Wu, Huanlong Zhang, Yuanyuan Wu and Wei Wang
An effective machine vision-based method for micro-crack detection of solar cell can economically improve the qualified rate of solar cells. However, how to extract features which…
Abstract
Purpose
An effective machine vision-based method for micro-crack detection of solar cell can economically improve the qualified rate of solar cells. However, how to extract features which have strong generalization and data representation ability at the same time is still an open problem for machine vision-based methods.
Design/methodology/approach
A micro-crack detection method based on adaptive deep features and visual saliency is proposed in this paper. The proposed method can adaptively extract deep features from the input image without any supervised training. Furthermore, considering the fact that micro-cracks can obviously attract visual attention when people look at the solar cell’s surface, the visual saliency is also introduced for the micro-crack detection.
Findings
Comprehensive evaluations are implemented on two existing data sets, where subjective experimental results show that most of the micro-cracks can be detected, and the objective experimental results show that the method proposed in this study has better performance in detecting precision.
Originality/value
First, an adaptive deep features extraction scheme without any supervised training is proposed for micro-crack detection. Second, the visual saliency is introduced for micro-crack detection.
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M.A. Abd El‐Ghaffar, N.A. Abdelwahab and E.A.M. Youssef
The purpose of the paper is to examine the synthesis of polyaniline (PAn) and poly(m‐toluidine) (PmT) via an inverse emulsion polymerisation pathway and evaluate of the…
Abstract
Purpose
The purpose of the paper is to examine the synthesis of polyaniline (PAn) and poly(m‐toluidine) (PmT) via an inverse emulsion polymerisation pathway and evaluate of the synthesised polymers as corrosion inhibitors for steel protection in surface coatings.
Design/methodology/approach
PAn and PmT were prepared by inverse emulsion polymerisation using ammonium persulphate as an initiator and sodium dodecylbenzene sulphonate (SDBS) as an emulsifier. Spectrophotometric measurements were conducted to characterise the prepared polymers. Latex paint formulations were prepared and dry paint films were evaluated for their physical, mechanical and corrosion protection performance.
Findings
The prepared conducting polymers of PAn and PmT are good candidates for enhancing the corrosion protection of steel. They showed good performance as corrosion inhibitors in latex paints without bad side effects on the physico‐mechanical properties of paint films.
Practical implications
Recent advances in corrosion protection of steel by coatings via inverse emulsion polymerisation of aniline and m‐toluidine have improved performance of anti‐corrosive water‐borne paints. Using formulations based on this new technology, offer uncompromised high performance eco‐friendly anti‐corrosive water‐borne systems that answer the future industrial demands from the economical and environmental points of view.
Originality/value
PAn and PmT prepared by inverse emulsion polymerisation showed promising results as corrosion inhibitors for steel protection. The polymerisation process was conducted in water (emulsion polymerisation) and the polymer lattices were incorporated in water borne paints from ecological and economical points of view.