Abstract
Using new UK legislation that imposes mandatory trading bans prior to company reports, I test the hypothesis that insiders will respond to such bans by trading in correlated stocks for which they are not classified as insiders. I fail to replicate the results from the existing literature on voluntary trading bans and find an ambiguous effect of the new legislation on bid-ask spreads. Furthermore, I find no evidence for substantial stock substitute trading. Possible reasons for the differences between my findings and the existing literature is discussed, and I conclude that previously found effects of insider blackout periods on bid-ask spreads are likely to be overstated.