Chief Financial Officers
Chief financial officers and the information in their trades
The study that singled out finance chiefs
Wang, Shin and Francis (Journal of Financial and Quantitative Analysis, 2012) asked whether trades by chief financial officers reveal more about future stock returns than trades by chief executives. In US data covering 1992 to 2002, CFO purchases were followed by higher abnormal returns than CEO purchases. The gap held after the authors controlled for known risk factors, and it persisted after the trades became public.
CFO purchases also came before more positive earnings surprises. The authors read this as finance chiefs having a closer view of coming earnings.
Where the evidence stops
The result covers purchases, in one country, over one decade. Lakonishok and Lee (Review of Financial Studies, 2001) found no predictive ability in insider sales in general, so a CFO sale tells you little on its own. An average across thousands of trades does not predict the outcome of any single filing. The site's measured results are on the performance page.
Titles grouped here
Chief financial officer, directeur financier and directeur administratif et financier (DAF), principal financial and principal accounting officers in SEC filings, financial controllers, comptrollers and treasurers, plus foreign titles such as Finanzvorstand, director financiero, direttore finanziario, 财务总监 and 최고재무책임자. Each insider appears in the bucket that matches most of their filings, and the insider page shows the original title.