5 ms·

Sounds like insider trading to me. The backorders your company has are material non-public information.

jbverschoor 2y ago
Yet it is not
NoboruWataya 2y ago
"My company bought their product" does not sound like material non-public information. It certainly doesn't sound material (and for this reason I also think it was sheer dumb luck that the investment paid off so handsomely, rather than intimate knowledge of the business).
- jldugger 2y ago
  It's absolutely treated as insider info by policy where I work. It might not rise to SEC enforcement action, but if caught you probably won't have a job anymore...
  - kortilla 2y ago
    “Violated company policy” is a completely different thing from anything the SEC cares about.
  - SkipperCat 2y ago
    Why would your employer care what you invested in? How would they be impacted if you bought or sold public stock of someone they interact with? Would they care if you traded Google, Apple, Microsoft or Oracle? I think most employers wouldn't care at all.
    - georgeburdell 2y ago
      It matters if you’re in a position, no matter how small, to influence your employer’s dealings with the companies you’re invested in.
    - jldugger 2y ago
      One possible explanation is that we require this of our vendors and suppliers, and the easiest way to achieve that is by making it reciprocal. The actual policy wording: > No Third-Party Trading or Tipping. Do not trade in the securities of another company when aware of material nonpublic information about that company in connection with your work at ******. This includes trading in the stock of ****** suppliers, manufacturers, vendors, or customers, such as cellular network carriers or other channel partners. You must also not tip material nonpublic information about another company.
kortilla 2y ago
Not insider trading from SEC. You can absolutely use material non-public information your own company collects. The entire short selling industry is based on this. It might be a violation of your company’s policy, but unless your company has been given explicit access to material non-public info of nvidia (e.g. you work for their accounting firm), there is no SEC risk here.
- foobarqux 2y ago
  This is false, you are breaking your duty of confidentiality towards your employer. Read the numerous Matt Levine columns about this. I don't know that the specific information collected in this qualifies as material information but it seems like it might.
  - kortilla 2y ago
    No, it has to be explicitly outlined in the employee agreement if you’re not allowed to share some of the information. “Duty of confidentiality” is not a magic thing that just exists. All of the cases where people have been busted (e.g. the capital one credit card transactions) are because the SEC has an exact quote from the employee agreement that says something like “don’t use this mega database to do trading”. If your employee agreement doesn’t have something explicitly barring you from noticing racks of incoming inventory and using that information, then it’s not insider trading.
    - foobarqux 2y ago
      You are wrong. The duty of trust doesn't even require a formal contract, girlfriend/boyfriend qualifies for example. Also see point 4 from https://www.bloomberg.com/opinion/articles/2022-01-26/watch-out-for-shadow-trading https://www.bloomberg.com/opinion/articles/2022-01-26/watch-... for example where there is no discussion of explicit duty of confidentiality; it is presumed in an employment relationship.
- isotropy 2y ago
  NEVER assume that information learned because of your job is shielded from insider trading, even for a completely different company. From ten years ago, here are two data analysts from Capital One who thought they could use the data from credit card transactions to jump the gun on quarterly earnings reports for retail stores. Never traded Capital One stock. Didn't matter - SEC hammered them. https://www.sec.gov/litigation/litreleases/lr-23216 https://www.sec.gov/litigation/litreleases/lr-23216

Yet it is not

"My company bought their product" does not sound like material non-public information. It certainly doesn't sound material (and for this reason I also think it was sheer dumb luck that the investment paid off so handsomely, rather than intimate knowledge of the business).

jldugger 2y ago
It's absolutely treated as insider info by policy where I work. It might not rise to SEC enforcement action, but if caught you probably won't have a job anymore...
- kortilla 2y ago
  “Violated company policy” is a completely different thing from anything the SEC cares about.
- SkipperCat 2y ago
  Why would your employer care what you invested in? How would they be impacted if you bought or sold public stock of someone they interact with? Would they care if you traded Google, Apple, Microsoft or Oracle? I think most employers wouldn't care at all.
  - georgeburdell 2y ago
    It matters if you’re in a position, no matter how small, to influence your employer’s dealings with the companies you’re invested in.
  - jldugger 2y ago
    One possible explanation is that we require this of our vendors and suppliers, and the easiest way to achieve that is by making it reciprocal. The actual policy wording: > No Third-Party Trading or Tipping. Do not trade in the securities of another company when aware of material nonpublic information about that company in connection with your work at ******. This includes trading in the stock of ****** suppliers, manufacturers, vendors, or customers, such as cellular network carriers or other channel partners. You must also not tip material nonpublic information about another company.

kortilla 2y ago

Not insider trading from SEC. You can absolutely use material non-public information your own company collects. The entire short selling industry is based on this. It might be a violation of your company’s policy, but unless your company has been given explicit access to material non-public info of nvidia (e.g. you work for their accounting firm), there is no SEC risk here.

foobarqux 2y ago
This is false, you are breaking your duty of confidentiality towards your employer. Read the numerous Matt Levine columns about this. I don't know that the specific information collected in this qualifies as material information but it seems like it might.
- kortilla 2y ago
  No, it has to be explicitly outlined in the employee agreement if you’re not allowed to share some of the information. “Duty of confidentiality” is not a magic thing that just exists. All of the cases where people have been busted (e.g. the capital one credit card transactions) are because the SEC has an exact quote from the employee agreement that says something like “don’t use this mega database to do trading”. If your employee agreement doesn’t have something explicitly barring you from noticing racks of incoming inventory and using that information, then it’s not insider trading.
  - foobarqux 2y ago
    You are wrong. The duty of trust doesn't even require a formal contract, girlfriend/boyfriend qualifies for example. Also see point 4 from https://www.bloomberg.com/opinion/articles/2022-01-26/watch-out-for-shadow-trading https://www.bloomberg.com/opinion/articles/2022-01-26/watch-... for example where there is no discussion of explicit duty of confidentiality; it is presumed in an employment relationship.
isotropy 2y ago
NEVER assume that information learned because of your job is shielded from insider trading, even for a completely different company. From ten years ago, here are two data analysts from Capital One who thought they could use the data from credit card transactions to jump the gun on quarterly earnings reports for retail stores. Never traded Capital One stock. Didn't matter - SEC hammered them. https://www.sec.gov/litigation/litreleases/lr-23216 https://www.sec.gov/litigation/litreleases/lr-23216