Article
Multimarket Trading At Merger Announcement and Completion
Journal of Derivatives & Hedge Funds
ORCID
Rebecca Abraham 0000-0002-3144-7759
Document Type
Article
Publication Date
6-23-2011
Abstract/Excerpt
We examined multimarket trading in the stock and option markets during merger announcement and successful and failed completion. Using contemporary intraday stock and options data, we observed alternate call buying and stock selling for acquirer stock in cash mergers, call writing and stock selling, followed by put buying for acquirer stock in stock mergers at merger announcement. For successful completions, stock selling dominated for cash acquirers and put buying for stock acquirers. Deal failure was accompanied by initial put buying, followed by call writing and stock selling on target stock. Signalling between markets and the alternation of informed trading between markets was inferred.
DOI
https://doi.org/10.1057/jdhf.2011.13
Disciplines
Citation Information
Rebecca Abraham, Charlie W. Harrington, Jr. and Albert A Williams. "Multimarket Trading At Merger Announcement and Completion" Journal of Derivatives & Hedge Funds Vol. 17 Iss. 3 (2011) p. 186 - 197 ISSN: 1753-965X Available at: http://works.bepress.com/rebecca-abraham/64/