Why is insider trading illegal?

[oildaytrader]

Insider dealing is illegal because insiders are using dishonest means against the public they are working for.Most of it is walled insider trading which is impossible to prove.It is like asking somebody to protect your home from theft,and being robbed by the protector.

 

[wackypete2]

How are people supposed to know someone else has inside information?

Just ask them :innocent:

Peter

 

[meanreversion]

The other dubious practice which went on a couple of years back was rumour starting.. the hedgies would buy a load of GBP puts and then start rumours about UK banks. It nearly always worked. If you recall, Barclays nearly went under on the back of rumours, when its share price was down at 50p. It's even harder to prove rumour-mongers than inside traders.

 

[dealer911]

Insider traders are scum.. front running orders has been rampant for along time and it goes on alot more than you would think.. people have gotten so used to the regulator doing nothing that it is almost considered one of the perks of the job!.. the cheats should be banged up

 

[meanreversion]

Insidious insiders

 

[awe]

Hello arabianights.

This it, if we call the 'info' 'news', then there are always the ones who are going to get the 'news' before someone else. I suppose news is never really spread around at a totally fair rate.

Hi!

I was having this same debate with someone a few months ago when all the Toyota recalls were happening.

When does 'insider info' become 'news', what I mean is, how many people have to know? There must be some law that clearly draws the line on this? Someone is always going to know first, so bully for them.

The whole debate over insider info seems so grey it's a little worrying to think that a large part of capitalism could be ruined by something so hard to determine.

 

[gooseman]

i think it's deemed as in the public domain-but that definition is probably as clear as mud.