The Nuances Of Insider Trading

The Insider trading  has become a novel way to cheat the public.  It is the trading of a public stock company by individuals with access to non-public information about the company.It is mostly associated with  the illegal conduct.

It is legal when the directors, employees, and officers trade stock of their own company, Illegal trading refers to buy and sell a security in breach of fiduciary duty or other relationship of trust or confidence, while in possession of material non-public information about the security.

This happens in many a corporate trading of securities. The insiders  give a tip of the corporates developments. They trade and share it with their friends and relatives. Law, banking, and brokerage firms trade with the leaked information  Government employees have access to the insider information and they trade. To a certain level, misappropriation also finds its way.

With the knowledge  received from the insiders many prosperous investors made huge sum of money during the IPO's and corporate mergers. This type of trading undermines investors confidence
thwarting the fairness and the integrity o the security.


Many have taken advantage of the tips  and amassed huge wealth. It is a gross violation.