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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/27146
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| Title: | Good Timing: CEO Stock Option Awards and Company News Announcements |
| Authors: | Yermack, David |
| Issue Date: | Oct-1995 |
| Series/Report no.: | FIN-95-035 |
| Abstract: | This paper proposes and implements a new method for investigating
whether CEOs influence the terms of their own compensation. I analyze
the dates of 619 stock option awards to CEOs of Fortune 500 companies
between 1992 and 1994, finding that the timing of awards coincides with
favorable movements in company stock prices. Patterns of
companies’ quarterly earnings announcements are consistent with an
interpretation that CEOs receive stock option awards shortly before
favorable corporate news. I evaluate and reject several alternative
explanations of the results, including insider trading and the
manipulation of news announcement dates. |
| URI: | http://hdl.handle.net/2451/27146 |
| Appears in Collections: | Finance Working Papers
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