Would you say that barring insider trading is a way to encourage broader, shallower groups of investors so that the noise (as in signal-to-noise) caused by indi

Would you say that barring insider trading is a way to encourage broader, shallower groups of investors so that the noise (as in signal-to-noise) caused by individual traders is smoothed out better? If there were 1K inside traders who were the only profit-makers, would the price of a security be more volatile than if there were 100K "outside" traders who all had a virtually equal chance of profit?