  In this paper, we present a multi-period trading model by assuming that
traders face not only asymmetric information but also heterogenous prior
beliefs, under the requirement that the insider publicly disclose his stock
trades after the fact. We show that there is an equilibrium in which the
irrational insider camouflages his trades with a noise component so that his
private information is revealed slowly and linearly whenever he is
overconfident or underconfident. We also investigate the relationship between
the heterogeneous beliefs and the trade intensity in the presence of trade
disclosure, and show that the weights on asymmetric information and
heterogeneous prior beliefs are opposite in sign and they change alternatively
in the next period. Under the requirement of disclosure, the irrational insider
trades more aggressively and leads to smaller market depth. Moreover, the
co-existence of "public disclosure requirement" and "heterogeneous prior
beliefs" leads to the fluctuant multi-period expected profits and a larger
total expected trading volume which is positively related to the degree of
heterogeneity. More importantly, even public disclosure may lead to negative
profits of the irrational insider's in some periods, inside trading remains
profitable from the whole trading period.
