Study of Signal Distortions on Behavior of Internal Traders

Abstract

In this paper was based on Kyle (1985) model, considering the conduction problem of the value of internal information, and established a single term insider trading by trading model to consider the case of signal distortions for the true value of the risky assets. And studied the effect of internal information has on the nature of internal trading strategies and market under a more general assumption condition. And compare the conclusion with Kyle (1985) model.