insider trading

Meaning

Insider trading refers to the illegal practice of buying or selling a public company's stock by someone who has non-public, material information about that stock. It is a serious financial crime that undermines trust in the stock market. The term is always negative and carries legal connotations.

Examples

• The former executive was sentenced to prison for insider trading.

  The former executive was sentenced to prison for insider trading.

• The SEC is investigating several employees for suspected insider trading ahead of the merger.

  The SEC is investigating several employees for suspected insider trading ahead of the merger.

• To prevent insider trading, employees are barred from selling shares during black-out periods.

  To prevent insider trading, employees are barred from selling shares during black-out periods.

• She was accused of insider trading after selling her stock just hours before the bad news went public.

  She was accused of insider trading after selling her stock just hours before the bad news went public.

• Our company's compliance training outlines strict rules against insider trading.

  Our company's compliance training outlines strict rules against insider trading.

Common Mistakes

• ✗ He was arrested for doing insider trading.

  ✓ He was arrested for insider trading.

  In English, we do not 'do' insider trading. We 'commit' insider trading, 'engage in' it, or simply use 'insider trading' as the noun object of a preposition.

• ✗ The insider tradings harmed many small investors.

  ✓ Insider trading harmed many small investors.

  'Insider trading' is an uncountable noun and should not be pluralized.

Related Expressions

Practice

• Using confidential company secrets to buy stock is a classic case of ___.

  💡 Illegal stock trading based on private info

  Show answer

  insider trading

• The regulatory body was set up to detect and prosecute ___.

  💡 The illegal practice of trading with non-public information

  Show answer

  insider trading