What is meant by insider dealing? Why is it illegal?

Answer 1

Insider trading is when people inside the company buy or sell shares of stock in the company where they work. In general, it is not illegal at all.

It only becomes illegal when they are trading based on information that is not public. It is illegal because they are taking advantage of people without that information.

The term sometimes applies to outsiders who hav eprivate information -- like investment bankers who know tha a deal is about to be announced.

Answer 2

It is when someone with special knowledged of the business trades stock before that knowledge is made public. It is illegal because an executive could easily sell out all of his shares ahead of the market when he knew some bad news was about to hit. But in reality, it happens all of the time. This is actually one of the many crimes in which our president G.W. Bush has engaged.

"Behind every great fortune, there is a crime." -- Honore de Balzac

Answer 3

insider trading

you know that a certain company will merge with another
on Wednesday - thus driving up the price of the stock

so you buy $10,000 and make a bunch KNOWING that
it was going to happen

or - you know that your company is going to post record losses and the chairman will be indicted for embezzlement
so - - - you sell everything before ENRON drops to zero
when it's still high

that's not fair

I know how to drive the price of ANY stock down

All I have to do is buy it

all the best

Answer 4

the dealing is between u n him without any third party knowledge,so it's an offence n illegal according to the rule n regulation in a company.

Answer 5

Not only could they sell out to avoid losses but the big thing here is they could short sell stock as well (borrowed stock that is sold and then replaced when it is bought back at a later date).

Answer 6

Please do your own homework.