4 ms·

Where are you reading that?

leto_ii 6y ago
> But last week, the short-selling investment firm Hindenburg Research published a bombshell report claiming that the Nikola One wasn't close to being fully functional in December 2016. Indeed, Hindenburg published a 2017 text message exchange in which a Nikola employee stated that the company didn't resume work on the truck in the months after the show.
- stu2b50 6y ago
  That's insider trading, but not Insider Trading™. >In the United States and most non-European jurisdictions not all trading on non-public information is illegal insider trading. For example, a person in a restaurant who hears the CEO of Company A at the next table tell the CFO that the company's profits will be higher than expected and then buys the stock is not guilty of insider trading—unless he or she had some closer connection to the company or company officers. However, even where the tippee is not himself an insider, where the tippee knows that the information is non-public and the information is paid for, or the tipper receives a benefit for giving it, then in the broader-scope jurisdictions the subsequent trading is illegal. Basically, so long as the text exchange wasn't given to Hidenburg in return for some kind of economic favor, there isn't a legal issue.
  - maest 6y ago
    As Matt Levine likes to say, "Insider trading isn't about fairness, it's about theft". Insider trading isn't about making the markets fair and giving the same information to all investors. It's about stopping people from trading on information they don't own - i.e. with information owned by the company itself. If I fly a helicopter and see oil levels in BP's oil tanks, I can trade on that information just fine, even if I mighjt be the only person with that info. If BP calls me up and tells me what their oil levels are in the same tanks, I can't trade on that information, because it was obtained from the company.
  - leto_ii 6y ago
    Thanks for the clarification.

> But last week, the short-selling investment firm Hindenburg Research published a bombshell report claiming that the Nikola One wasn't close to being fully functional in December 2016. Indeed, Hindenburg published a 2017 text message exchange in which a Nikola employee stated that the company didn't resume work on the truck in the months after the show.

stu2b50 6y ago
That's insider trading, but not Insider Trading™. >In the United States and most non-European jurisdictions not all trading on non-public information is illegal insider trading. For example, a person in a restaurant who hears the CEO of Company A at the next table tell the CFO that the company's profits will be higher than expected and then buys the stock is not guilty of insider trading—unless he or she had some closer connection to the company or company officers. However, even where the tippee is not himself an insider, where the tippee knows that the information is non-public and the information is paid for, or the tipper receives a benefit for giving it, then in the broader-scope jurisdictions the subsequent trading is illegal. Basically, so long as the text exchange wasn't given to Hidenburg in return for some kind of economic favor, there isn't a legal issue.
- maest 6y ago
  As Matt Levine likes to say, "Insider trading isn't about fairness, it's about theft". Insider trading isn't about making the markets fair and giving the same information to all investors. It's about stopping people from trading on information they don't own - i.e. with information owned by the company itself. If I fly a helicopter and see oil levels in BP's oil tanks, I can trade on that information just fine, even if I mighjt be the only person with that info. If BP calls me up and tells me what their oil levels are in the same tanks, I can't trade on that information, because it was obtained from the company.
- leto_ii 6y ago
  Thanks for the clarification.