Researcher ORCID Identifier


Graduation Year


Date of Submission


Document Type

Open Access Senior Thesis


Robert Day School Prize for Best Senior Thesis in Finance

Degree Name

Bachelor of Arts



Reader 1

Eric Hughson

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© 2024 Kamila K Melikova


Existing research has thoroughly examined the impact of insider trading regulations, finding mixed results regarding the effectiveness of new law introductions. Although this topic has received considerable attention, there is still a notable lack of research on the first regulation of insider trading: the 1942 introduction of Section 10(b), an amendment to the Securities Exchange Act of 1934. This paper uses a newly compiled dataset of earnings announcements from large public companies between 1937 and 1946, combined with event study methodology, to investigate the effectiveness of the very first ban on insider trading. Through the application of t-tests and regression models, this study finds that insider trading activity, measured by abnormal stock price run-ups prior to earnings announcements, did not significantly decrease after the introduction of SEC Rule 10b-5. While the results of the study were not statistically significant, they highlight key questions about factors that could influence regulation efficacy.