3 ms·

Pretty sure the answer is no. US insider trading law is very much concerned not just with whether you traded on material nonpublic information, but also on whet

Pretty sure the answer is no. US insider trading law is very much concerned not just with whether you traded on material nonpublic information, but also on whether your trading based on this information was a breach of trust between you and the person giving you the information. As far as I understand, overhearing a stranger discussing a deal at the local Starbucks and trading on that, is perfectly legal. But overhearing your wife discuss a deal and trading on that is illegal, as it is a breach of trust. Edit: I managed to find the article I remember reading on this. Turns out it was Matt Levine in Dec. 2018. To quote him: > Famously, in American insider trading law, it’s legal to trade on inside information that you randomly overhear in a train station. https://www.bloomberg.com/opinion/articles/2018-12-03/insider-trading-in-the-potato-trade https://www.bloomberg.com/opinion/articles/2018-12-03/inside...

GhettoMaestro 7y ago
> As far as I understand, overhearing a stranger discussing a deal at the local Starbucks and trading on that, is perfectly legal. But overhearing your wife discuss a deal and trading on that is illegal, as it is a breach of trust. I believe this is technically incorrect. If the information you heard inadvertently was non-public and you trade on it, that is still illegal.
darawk 7y ago
That's correct, but i'm not sure this qualifies. I think the person who's trust you're breaching has to have some fiduciary relationship to the company in order to qualify. Trump is more of a macro event and doesn't have any sort of privileged status in relation to a company, so i'm not sure if he'd qualify.
opportune 7y ago
Is a stranger talking on the phone in Starbucks really public information? If so, I would start a SAAS that just puts a microphone in every Starbucks and high end restaurant in ritzy corporate areas like Bellevue, Palo Alto, Manhattan and sell that data to some quant fund. That signal could be worth billions per year
- lbotos 7y ago
  People often confuse "public information" with "easily understood and widely available" information.
- deleted 7y ago
  [deleted]
- AznHisoka 7y ago
  If you start that, let me know. I'll then head to my local Nobu with a friend, and pretend I'm from Adobe discussing an imminent deal to buy Docusign, while holding Docusign shares :)
  - opportune 7y ago
    I take no responsibility for model drift and filtering adversarial data is the responsibility of the consumer :)

GhettoMaestro 7y ago

> As far as I understand, overhearing a stranger discussing a deal at the local Starbucks and trading on that, is perfectly legal. But overhearing your wife discuss a deal and trading on that is illegal, as it is a breach of trust. I believe this is technically incorrect. If the information you heard inadvertently was non-public and you trade on it, that is still illegal.

darawk 7y ago

That's correct, but i'm not sure this qualifies. I think the person who's trust you're breaching has to have some fiduciary relationship to the company in order to qualify. Trump is more of a macro event and doesn't have any sort of privileged status in relation to a company, so i'm not sure if he'd qualify.

opportune 7y ago

Is a stranger talking on the phone in Starbucks really public information? If so, I would start a SAAS that just puts a microphone in every Starbucks and high end restaurant in ritzy corporate areas like Bellevue, Palo Alto, Manhattan and sell that data to some quant fund. That signal could be worth billions per year

lbotos 7y ago
People often confuse "public information" with "easily understood and widely available" information.
deleted 7y ago
[deleted]
AznHisoka 7y ago
If you start that, let me know. I'll then head to my local Nobu with a friend, and pretend I'm from Adobe discussing an imminent deal to buy Docusign, while holding Docusign shares :)
- opportune 7y ago
  I take no responsibility for model drift and filtering adversarial data is the responsibility of the consumer :)