Insider trading refers to the buying or selling of a publicly-traded company's stock by someone who has non-public, material information about that stock. Insider trading can be legal or illegal depending on when the insider makes the trade; it is illegal when the material information is still non-public, and this illegal activity can lead to severe penalties.

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Insider Trading Is

Question 71

Multiple Choice

Insider trading is:

A) Any trading in company securities by top management.
B) Both a purchase and a sale of the same company's securities by top management within a 6-month period.
C) Trading activity that results in abnormal gains.
D) Any trading in company securities based on information not available to the public.

Correct Answer: