3 ms·

I don't trust this. I want to see cancellation of scheduled trades. I.e. Bezos/Cook not divesting shares on schedule all of a sudden.

by crb002 6y ago

oh_sigh 6y ago
Their share sales are scheduled many months in advance and cannot be canceled (10b5)
- sargun 6y ago
  You can cancel a 10b5-1 plan whenever you choose.
- dmurray 6y ago
  A 10b5-1 plan can be cancelled, and cancelling one when in possession of inside information is not insider trading. Could you set up one plan to buy shares and one to sell them, and cancel whichever one isn't favourable? No. There's a clause that requires you to have set up the plan in good faith. But if you planned to sell your stock, and get once-in-a-lifetime news the price is going up tomorrow, it's completely fine to cancel it.
  - benrbray 6y ago
    Maybe it's not currently illegal, but shouldn't it be? Once in a lifetime news on a stock price about to go up sure sounds like material non public information to me.
    - AznHisoka 6y ago
      OP just gave an extreme example but if the CEO saw sales was on a promising trend (or other reasons that don’t count as insider trading) he/she might cancel the sell. And it would be useful to see that.
      - benrbray 6y ago
        Is there a good reason that a CEO should be able to use private sales data to inform their trades? (in this case, to cancel a previously scheduled trade)
        dmurray 6y ago
        There is no good reason. It's really a loophole in the law. An understandable one, because cancelling a trade is not legally the same as making a trade, even if financially it's the same. And one that's small enough not to have been worth closing. You won't get away with cancelling your plan every time sales data is bad, you should wait for the once-in-several-lifetimes opportunity when you get game-changing news and you were just about to sell a large quantity of stock. You can come up with a bigger conspiracy theory than this, but the more boring explanation looks true.

I don't trust this. I want to see cancellation of scheduled trades. I.e. Bezos/Cook not divesting shares on schedule all of a sudden.

by crb002 6y ago

I don't trust this. I want to see cancellation of scheduled trades. I.e. Bezos/Cook not divesting shares on schedule all of a sudden.

oh_sigh 6y ago

Their share sales are scheduled many months in advance and cannot be canceled (10b5)

sargun 6y ago
You can cancel a 10b5-1 plan whenever you choose.
dmurray 6y ago
A 10b5-1 plan can be cancelled, and cancelling one when in possession of inside information is not insider trading. Could you set up one plan to buy shares and one to sell them, and cancel whichever one isn't favourable? No. There's a clause that requires you to have set up the plan in good faith. But if you planned to sell your stock, and get once-in-a-lifetime news the price is going up tomorrow, it's completely fine to cancel it.
- benrbray 6y ago
  Maybe it's not currently illegal, but shouldn't it be? Once in a lifetime news on a stock price about to go up sure sounds like material non public information to me.
  - AznHisoka 6y ago
    OP just gave an extreme example but if the CEO saw sales was on a promising trend (or other reasons that don’t count as insider trading) he/she might cancel the sell. And it would be useful to see that.
    - benrbray 6y ago
      Is there a good reason that a CEO should be able to use private sales data to inform their trades? (in this case, to cancel a previously scheduled trade)
      - dmurray 6y ago
        There is no good reason. It's really a loophole in the law. An understandable one, because cancelling a trade is not legally the same as making a trade, even if financially it's the same. And one that's small enough not to have been worth closing. You won't get away with cancelling your plan every time sales data is bad, you should wait for the once-in-several-lifetimes opportunity when you get game-changing news and you were just about to sell a large quantity of stock. You can come up with a bigger conspiracy theory than this, but the more boring explanation looks true.