Insider

>All non-insider information is already factored into the price
That's objectively untrue. Markets aren't beacons of rationality

How so? Let's walk through an example here: Say you own a stock. You want to sell it (for whatever reason, maybe you need liquidity, maybe you want to rearrange your portfolio, whatever) so you put a sell bid on market. Someone buys the stock and you get your money. A few days later the stock flies high.
What difference does it make to you whenever the guy who purchased your stock was acting on insider information or not? You were going to sell it for that price anyway.

How dumb can you be?

Speaking of illegal things. Are pump & dump groups which can clearly link back to your ID... illegal? or everything is fairgame with crypto? it's a wild west with no sheriff?

I still don't see an actual explanation

The insiders are making money. They're not making money from each other. Where is that money coming from? Come on, use your brain.

Irrelevant.

Stocks have no objective value, their value is determined by the market, rational or otherwise.

I'll just write black lives matter over and over again on my application

You're right, that doesn't mean their prices reflect available information.

why is using a vespa in a marathon against the rules? it doesnt hurt anyone, everyones gonna finish on the same time anyway regardless of your vespa

ITS AN UNFAIR ADVANTAGE YOU RETARDED FUCK

Except a marathon is a competition, where the whole point is to compare performance. If I make money that does not decrease your wealth, unless I earned my money in such a way that I increased the economy's total money supply.

Let me ask you this: Suppose I donated some money to pay for some kid's education. Now that kid has an "unfair advantage" over his peers. But does that hurt his peers? Are they somehow worse off?

Can you explain why how one stock trader can, by insider trading, harm another?

suppose he had the answers before taking the test

Alright, so as far as I can see your reasoning is something like this: "Inside traders are making money and since they didn't create any wealth, they must have stolen that money." Am I getting close?

To answer your question, I'd say the money inside traders are making comes from the exact same source the regular traders get their money from; A company grows, it's dividends (and subsequently value) increases, and whoever happens to own that stock makes money, whenever the owner purchased the stock due to a tip, an analysis or plain luck. Stock investors, as a whole, make their money essentially from providing investment capital to companies and charging for that investment.

So what if it is illegal? It is still being done.

>who get's hurt by it
Everyone gets hurt by it. There is already low trust in the market. This would just be another reason not to trust the market. Companies eventually would never be able to raise money to start businesses or upgrade assets.

whats with the retarded outlook on law? not every crime hurts people, cheating on a test doesnt hurt anyone else either, but most people want to make the world as fair as possible, thats what law is for

i also dont know why i have to say that charity isnt the same as getting rich from insider market speculation, but i guess i do

Then that could only be harmful to the economy in the sense that later in life he might perform an important job he is not qualified for (maybe perform a medical job without proper competence). But that type of wrongdoing hardly translates into a problem in the financial sector. As I mentioned earlier, if a stock investor makes money from buying a stock that goes up, that doesn't decrease your wealth or hurt you in any way.

It seems the only point if your "answers-to-test"-question is what everyone else has said so far: "It's not fair." But you haven't explained how anyone is actually hurt by it.

Did you see the first post I made? I already know that insider trading is not fair, but I don't think that by itself is a good enough reason to forbid it. I think that if nobody os actually hurt by it, if there are no actual victims, then it should be legal. That is the entire point of this thread. I'm asking: How is anyone hurt by it?

...

>Companies eventually would never be able to raise money to start businesses or upgrade assets.

See now this is an actual argument. Thank you.

IIRC insider trading was technically legal in the U.K. until the 80s

>Can you explain why how one stock trader can, by insider trading, harm another?
One trader, privy to whatever inside information due to the hypothetical legality of insider trading, knows another investor that is heavily invested in a certain company. He could potentially lie to the other man that would make him sell his stock so he could buy it up just prior to the event he is aware about due to his insider knowledge.

>Alright, so as far as I can see your reasoning is something like this: "Inside traders are making money and since they didn't create any wealth, they must have stolen that money." Am I getting close?

Not even close. Insider trading only exists in stock markets, not in forex or commodities. You cant calim somebody insider traded forex pair lol-

Small cap and penny stocks are ofcourse the number one targets this tends to happen, but sometimes even the larger corporations. However, they tend to get caught more easily because so wide media attention etc. leading to investigations

>not every crime hurts people, cheating on a test doesnt hurt anyone else either

Yes, it can. It can promote you to a job position that you are not actually qualified for. And if you're building your argument on the assumption that the current laws are rational then I simply don't accept that premise. It is a weak premise that I can completely discard, and I think you're aware how weak it is.

>i also dont know why i have to say that charity isnt the same as getting rich from insider market speculation

What most people have said in this thread is that insider trading should be forbidden on the premise that it is "unfair". If you assume that things that are "unfair" should be forbidden then that means that random charities and such should also be considered unethical and perhaps get banned. After all, they are also "unfair", aren't they? In fact, there's quite a few things in life that are unfair, and if we were to argue that everything unfair is unethical then that would lead to conclusions that would seem absurd to most of us. Actually, I'll cut you some slack and assume you're only criticizing "man-made" unfairness. Even then, if we only sought to ban those human actions that resulted in unfairness the results would still be absurd.

Hence, you cannot possibly believe that actions should be forbidden just because they result in unfair advantages. Which brings me back to the question at hand, why to ban insider trading.

So you sold and the price went up, and if you buy a stock the price goes down, because the insiders know better than you. Then very quickly you realize this tends to happen to you more often than not, because you are an outsider. Now tell me, how do you make money buying high and selling low?

Do you see how you are disadvantaged now?

Because we are not an ancap wasteland/paradise. Lines have been drawn to protect the weak from the strong, and this is one of them.

thought experiment:

take the inverse of the question and ask the consequence of hiding information from some rather than revealing to some, any difference?

i work at a bank and worked on the company's year end financials. I knew it was a miss and that the share price was going to take a hit. I could have put my life savins into put options and made a killing but i can't because it's insider trading.

That's why we need the laws. SO shitters like me can't get rich and have to slave away instead.

Trading stock requires 2 simultaneous beliefs:

1. My analysis of the stock is better than the market's analysis

2. The market will eventually move towards my evaluation

With insider information this makes sense. Your evaluation is better because you have additional information and the market will move towards your evaluation when this insider information becomes public.

However, without insider information these two beliefs are contradictory. (1) assumes the market is irrational while (2) assumes the market is rational.

If the market is so stupid that a NEET in his basement can outsmart them then he has no reason to believe these same stupid people will suddenly change their mind and agree on the NEET's evaluation.

Stock trading is for retards.

Great perspective. Anyone who does this and still can't see why insider trading is bad needs to kys

It's illegal you dumbass. But the SEC probably has better things to do than go after someone who made $700 off of some Veeky Forums scam. Probably.

>But the SEC probably has better things to do than go after someone who made $700 off of some Veeky Forums scam
I work at the SEC. We've been reviewing blockchain and issuing subpoenas. A lot of the scams are overseas, so it takes a while.

I think fundamental analysis is most useful for comparing between investment options.

Frankly, I think identifying whether or not a well established company is currently under/overvalued is a bit too speculative, the market and big players decide that, not you.

Marketing is always given a bad rap as being a meme degree, but it actually plays a huge role in determining how a company focuses its value to customers. And cost accounting/ engineers decide how allocate resources most efficiently, and to price the company's output appropriately to suit targeted customers and beat competitors.

These are the things that should be focused on when investing in a company - Cost Accounting/Engineering and Marketing of the product (and you need to seriously look into the company for this, this means even asking the company itself, directly, which isn't always possible). Finance should be used to compare between investments, so as to determine which offers the best deal over a certain period of time.

Fundamental analysis indicators (ratios etc) are also useful for determining the stability of the company, but just looking at numbers tells you fuck all about the potential of the company itself. Therefore, I think Cost Accounting/ Engineering and Marketing are the key points of information for investors to try and find out about if they truly want to invest in value. Again, it's kind of hard to get hold of these specifics of all companies, but that's the reality. This is partly how Buffet/ Berkshire Hathaway (and holding companies, in general) invests too.

best answer in the thread

Because you don't get invited to the Bilderberg meetings.

KYS

The actual answer is that insider trading damages the health of capitalism as a whole, which leads to a sub optimal society, which is not something most people want

You sound like Benito Mussolini

"...The Fascist State organizes the nation, but leaves a sufficient margin of liberty to the individual; the latter is deprived of all useless and possibly harmful freedom, but retains what is essential; the deciding power in this question cannot be the individual, but the State alone.... "

>Yes, it can. It can promote you to a job position that you are not actually qualified for.

so can making money with insider info

>the charity thing

the whole point of a charity is to fix unfairness that already exists, you dont create unfair situations by giving food to someone who doesnt have any or donating to some natural disaster fund

and ofcourse im talking about man-made unfairnes

>Hence, you cannot possibly believe that actions should be forbidden just because they result in unfair advantages. Which brings me back to the question at hand, why to ban insider trading.

i can repeat myself again the basic thing in most laws is a fair society, thats why killning someone in self defense (the fair option) and killing someone just for fun (the unfair option) have different punishments. im sorry that most of society wants equal opportunity

Insider trading should be totally legal as long as one is under the age of 40 (after that it should become a grave offense punishable by imprisonment)