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Legitimate Lawmakers and Insider Trading Practices

By Edited Jun 29, 2014 0 0

Lawmakers and inside trading occurs when a particular information has been shared or has been disseminated to a specific person or group of persons which are not a part of a corporation. In traditional practice the use of insider trading is actually illegal, however rules have now been provided in order to make it legal.

So to orient you with the rules and to present to you how to make insider trading legitimate, take a sneak peak at the following rules which are the basis in classifying it as legitimate.

Buy or sell stocks in the company you work for. When you have a share in that company and you are able to share the information to outsiders then it would still be legal since you’ve purchased a part of it and that it also belongs to you which therefore means that you have every right to do what you want at your own cost.

Do not buy a stock from another company if you are just compelled to do it because you have obtained important information about them. The action you would be taking would be considered a crime. Also make sure to trade stock in a company that you do not work for based on information acquired from someone who is pretty much well aware of lawmakers and insider trading and has higher level of knowledge of the workings and internal information of a company.

Sell or buy stock which has been established before you obtained outside information about a company. This act is considered legal in accordance to the fact that you hadn’t used the information you have acquired in the course of your action but rather you’ve pursued on the plan you’ve arranged prior to that knowledge.

On a lot of cases you can really say that doing insider trading is illegal especially because of the fact that you are actually giving out information which was supposed to be kept discreet as to keep low profile on the eyes of your competitors. However, the benefit of having a healthy competition in the market is only achievable when one company knows much about the other. Being a part of lawmakers and insider trading practices would then eventually result in companies providing better services and products, knowing that their competitors have the potential of attracting their market if they won’t make improvements on the services or products being offered.



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