Business for Insider Trading

Insider Trading
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Insider Trading
Introduction
According to Doffou, A.(2003), Insider trading is the practice of selling or purchasing securities from a publicly trading company while one has material information that the public is not privy to. The public may not be aware of the material information because it is not legally out to the public domain. Insider dealing is a breach of fiduciary trust since the trader uses the information to benefit financially. Rules and regulations are put in place by the government to keep the market fair for all the investors. The article by Doffou can be accessed via URL /publication/228321500_Insider_Trading_A_Review_of_Theory_and_Empirical_Work and talks about the laws regulating insider trading, parties involved, and how it works.
How does insider trading works
Once one is privy to inside information, they can use it to profit and avoid losses when trading. Insider information used to benefit oneself can be considered as abuse of power. Insider trading is deemed to be unfair because it gives an adv...