The strict trade-disclosure rules for insiders
reflect a strong, longstanding consensus in the United States that a corporation's insiders
--its officers, directors, and controlling shareholder (if any)--should not be permitted to profit freely from their access to inside information about the firm.
Our database of insider
trading filings shows that three other insiders
bought shares in May of this year (http://www.
The law is clear that if corporate insiders
trade on material, nonpublic information while silently failing to disclose the basis of their trade, their silence may ground a conviction.
The second argument relies on the entrepreneurial role played by corporate managers and how insider
trading could be used to compensate those insiders
for their entrepreneurial activities.
who receive stock options may be restricted as to when they can sell the underlying stock.
I found that an outside investor could have simply bought a diversified portfolio of small-cap stocks with high yields and low price-to-earnings ratios, and would have received almost the same return (with lower risk) as the group of insiders
in my study.
trading is the epitome of an undefined, unconstitutionally vague offense.
So the Insiders
, who conspire for a world without freedom, must obscure their global ambitions.
Partners and staff face tough decisions when managing the insider
trading risk inherent in the freedom to buy and sell securities.
should count on nothing unless the company has a tradition of weighting the scales for current employees.
Although the Waste Management example is an extreme case, insiders
such as directors, officers and key executives may be sending valuable signals when they sell their company's shares.