61–70 of 130 posts
Earlier quoted context omitted.
So a "trade canary", then.
I wonder if it would be possible to track the continual sales of stock by large shareholders, use that to buy options based on the canary trades disappearing. This would then lead to the question: am I an insider trader if I am basing my options off of the lack of sales of insiders?
Replace hackers with the NSA. Imagine the trades one could make with access to the world's email inboxes.
It's actually still possible to perform a specific type of legal insider trading. Example: you are an executive at E Corp and the company will announce its acquisition in two months. You had previously set up planned trades to sell x number of shares each month before then. Because the acquisition is at a premium on the current price, you will make much less money if you go forward with your trades before the announc…
Politicians in Congress are explicitly allowed to insider trade based on information they hear about. This is why congressmen's stock portfolios are far more profitable than an average person's.
The only study on the performance on Congressional stock portfolios is from 2004 [1]. Do you know of any post-STOCK studies?
[1]: Ziobrowski, A.J., Cheng, P.X., Boyd, J.W., and Ziobrowski, B.J. (2004) “Abnormal Returns from the Common Stock Investments of Members of the United States Senate.” Journal of Financial and Quantitative Analysis, Vol. 39, No. 4, pp. 661-676. (http://www.walkerd.people.cofc.edu/400/Sobel/P-04.%20Ziobrow...)
Perhaps someone will change my mind, but I see the block on insider trading and spoofing as harmful to the financial industry overall. Someone starts shorting a ton of Apple stock? That probably means something big is happen at Apple, and it's not good. It's information. Spoofing as a technique can be used to combat and inhibit other types of trading, and is in some sense an algorithm to 'keep the opponent honest'. A…
This isn't necessarily a problem. As a society, we've decided that we like having amateur capital in the markets more than we want the improved efficiency of allowing use of inside information. It's a tradeoff, and while both options have their merits, society has chosen one way.
Earlier quoted context omitted.
It makes sense to insulate Congressman from insider trading charges. They are exposed to so much inside information that the executive could bring charges against them on a whim. Which would have significant separation of powers concerns. Of course, the answer to that is to require all Congressmen to put their assets in a blind trust.
What about public disclosure of their stock holdings?
Earlier quoted context omitted.
Politicians in Congress are explicitly allowed to insider trade based on information they hear about. This is why congressmen's stock portfolios are far more profitable than an average person's.
It makes sense to insulate Congressman from insider trading charges. They are exposed to so much inside information that the executive could bring charges against them on a whim. Which would have significant separation of powers concerns. Of course, the answer to that is to require all Congressmen to put their assets in a blind trust.
Would it be so bad if insider trading laws just went away? Information is spreading faster than ever. So a few Mak outsized gains on some inside info. Is it that big a deal?
Corporations are supposed to operate on the behalf of their shareholders - insider trading is in direct conflict with that
Perhaps someone will change my mind, but I see the block on insider trading and spoofing as harmful to the financial industry overall. Someone starts shorting a ton of Apple stock? That probably means something big is happen at Apple, and it's not good. It's information. Spoofing as a technique can be used to combat and inhibit other types of trading, and is in some sense an algorithm to 'keep the opponent honest'. A…
The main reason we don't like insider trading is that we like participation in the market by relative amateurs. A system that allows insider trading discourages participation by amateurs, because they do not have insider information. Insiders would earn money at the expense of these amateurs, so it's better for them to stick to other sorts of investments to avoid this "tax". This isn't necessarily a problem. As a soc…
If there were 1K inside traders who were the only profit-makers, would the price of a security be more volatile than if there were 100K "outside" traders who all had a virtually equal chance of profit?
Then there is the story of the really sophisticated guys who didn't get caught. Unfortunately that's a story you won't be reading online, but will just have to imagine. It really makes me question the sanity of doing this illegal trading. For as much effort you could do something legal and make money. Maybe not as much but surely without the risk of going to prison.
Sadly, insider trading is pervasive on wall street. You don't read about the guys that don't get caught, and there are a lot of them. Remember, if you can't spot the sucker at the table, you're the sucker. That's why I keep my money far away from the stock market except for index funds.
It's actually still possible to perform a specific type of legal insider trading. Example: you are an executive at E Corp and the company will announce its acquisition in two months. You had previously set up planned trades to sell x number of shares each month before then. Because the acquisition is at a premium on the current price, you will make much less money if you go forward with your trades before the announc…
That seems a bit of a stretch to call that insider trading.