Insider Trading
Essays

Illegal insider trading can be defined as buying or selling stocks based on information that has not yet been made public in order to make a substantial profit or avoid a significant loss.

Economist Henry Manne argues that insider trading is beneficial to insider or outsiders because it allows trading to be based on reliable information instead of rumors.

Insider Trading Laws -- Should they apply to Members of Congress?

Insider trading is one of the aspects that have been surrounded by a lot of controversy with regard to securities regulation, which even includes the law and economics community. Before commencing this discussion, it is…

Examine the strengths and weaknesses of the two arguments against insider trading - property rights and fairness

The recent global financial crisis, and the heavy government intervention that has followed it, has indicated that the U.S. Government is set to play a bigger role in the private sector than at any time in history.

Insider trading is a contentious issue both in the stock markets and with the public as a whole. The public views the issue as a criminal one. They want fairness, and feel that protection against insider trading will…

Insider trading has two distinct effects on the financial sector. The first is a purely economic effect while the second is an indirect effect that, while harder to measure, in all likelihood, has a more serious overall…

Insider trading is a term that most individuals have heard and generally view it as an illegal conduct. In practice, the term usually is inclusive of both legal and illegal conduct.

According to information compiled by the SEC, a total of 58 insider trading actions were brought against 131 individuals and entities in 2012, and during the last three years the SEC filed more insider trading actions – a total of 168 – than in any three-year period in the agency’s history (2013). As the SEC states on the organization’s website, “these insider trading actions were filed against nearly 400 individuals and entities with illicit profits or losses avoided totaling approximately $600 million … (and) many involved financial professionals, hedge fund managers, corporate insiders, and attorneys who unlawfully traded on material non-public information, undermining the level playing field that is fundamental to the integrity and fair functioning of the capital markets” (2013). In nearly every case of insider trading listed on the SEC website, those accused are high-ranking officials and corporate executives who hold prominent positions providing them with affluence beyond the reach of nearly all Americans. However, despite holding enough wealth to live comfortably and ensure that future generations of their family could do the same, those accused of insider trading by the SEC invariably succumbed to a combination of greed and hubris, as they sought to manipulate the system in such a way that financial risk was removed from their investment transactions. While ordinary Americans struggled to weather the economic storm of last half decade, the corporate class continued to accumulate wealth at a staggering rate, largely through undocumented cases of insider trading and similarly unethical conduct.