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I actually agree it should be legal, but the argument is basically one of fairness. That in the market, retail investors compete against insiders. In practice.
by mchusma 5y ago
I actually agree it should be legal, but the argument is basically one of fairness. That in the market, retail investors compete against insiders.
In practice. The world is unfair, and retail investors must compete against all kinds of people with unfair advantages.
If insiders could legally trade, then the ability to profit off insider trading would go down.
- economist6373 5y agoIt’s important to understand that the usual argument against insider trading isn’t actually about true fairness, but rather the impression of fairness. These are two different things. The argument that insider trading should be banned because it is somehow disproportionately unfair is quite weak, the argument that it creates an impression of unfairness is a much stronger one. I personally don’t believe it is a particularly good argument, but it is certainly the strongest version of the argument against insider trading.