Business valuation and probability of insider information trading in the Brazilian capital market

Abstract

The aim of this study was to investigate the information asymmetry influence on business valuation in Brazilian capital market. For this, a study was conducted based on information asymmetry measurement on stock trading and the Ohlson model (1995) for business valuation. This study analyzed the relationship between information asymmetry and the prices of 198 stocks listed on BM&FBovespa, during the four quarters of 2011. The results suggest that information asymmetry have additional informational content on business valuation, mainly for those companies unlisted in the differentiated segments of corporate governance.