Desmarais Global Finance Research Centre (DGFRC) Seminar: Sheridan Titman
Sheridan Titman
University of Texas at Austin
Information Transmission in Dealer Markets:
Evidence from China Block Trades
Date: Friday, September 27, 2024
Time: 10:30-11:45 am
Location: Bronfman Bldg. (1001 Sherbrooke St. West), Room 340
All are cordially invited to attend.
Abstract:
Using proprietary account data on block trades from the Shanghai Stock Exchange, we study how dealers intermediate large sales. We find that dealers require larger discounts and liquidate their positions in the secondary market more quickly when the seller is an insider. Our evidence suggests that dealers acquire private information in the process of negotiating block sales, which they exploit when the shares are subsequently sold on the exchange. Notably, insider blocks are unwound more quickly than non-insider blocks and sell the shares faster, primarily to small retail investors, when future stock returns are less favorable.
