Insider Trading - Explained
What is Insider Trading?
Written by J. Mance Gordon
Updated at April 20th, 2024
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What is Insider Trading?
Stock trading by people who have information about securities and stocks that are confidential and not available to the general public is called Insider Trading. Sharing confidential company information with others as well as Insider Trading is illegal in most countries.
The only exception to illegal Insider Trading is when the Directors or Proprietors with 10% or more stake in a company, liquidate their stocks and make this knowledge public via legal channels. The Securities and Exchange Commission has rules and regulations in place to thwart insider trading investments by insiders.