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Insider Trading....How would you define it? (1 Viewer)

eoMMan

Footballguy
How would you define insider trading? I understand the clear cases such as a corp. executive telling a buddy about an upcoming product launch or numbers that are currently under wraps but where's the line? 

For example, are either of these hypotheticals insider trading?

 1. My spouse works for a publicly traded company and she doesn't work in accounting, finance, r&d, not an executive, etc. but sees business picking up.  I buy stock and do well.

2. The company I work for supplies an ingredient in a publicly traded company's bakery product (one ingredient of many). I see orders really ramping up (no knowledge of why though). I buy stock and do well.

Thoughts? I just always wondered where the line is.

 
Neither would be, on the surface. "Business picking up" can be seen in quarterly filings of these public companies, viewable by the public, and you would think that same information would be conveyed by the company in forecasts. 

The key in defining it is if it involves non-public information and your (or your spouse's) position in the company. I don't think the SEC would consider "ramping up" orders as such. 

 

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