Abstract: Taking 2006-2012 private placement events as context, the paper investigates large shareholders′ stock selling of private placement restricted shares, proving large shareholders getting excess income by their timing stock selling of private placement restricted shares is large shareholders′ main motivation to participate in private placement, the market timing ability is associated with their control-degree and influence ability to listed corporates, and their stock selling could encroach on small and medium-sized shareholders′ benefit.

Key words: private placement, stock selling, excess income, market timing ability