Rolf called Tim to discuss an as yet unannounced corporate takeover.Following Rolf's call,Tim purchased securities of both corporations on the basis of relevant material information he received.The securities are held in a joint trading account co owned by Tim and Rolf.In these circumstances,Rolf is a tippee,Tim is an insider,and both Rolf and Tim are guilty of insider trading.

Question

Quizplus · Accepted Answer

Rolf is the insider (as he has access to non-public, material information about the corporate takeover), Tim is the tippee (as he received the insider information from Rolf), and both could be guilty of insider trading if they traded based on this non-public information.

Rolf Called Tim to Discuss an as Yet Unannounced Corporate