4 ms·

Another reason could be that there are some really smart dudes profiting using only public or non-material non-public information. It seems hard to disentangle

by Bootvis 12y ago

Another reason could be that there are some really smart dudes profiting using only public or non-material non-public information. It seems hard to disentangle those two sources of information and I can't find anything about it yet in the paper.

deleted 12y ago
[deleted]
- Bootvis 12y ago
  It's at least unethical and probably forbidden. Furthermore I believe it is a breach of fiduciary duty. Maybe these friends tell their friends and this leads to the deal being canceled.
apaprocki 12y ago
Also if you have the raw feeds you can try to detect suspicious activity and then use that activity as a signal for your own trades. If you trade based upon public data (what winds up being insider trading) without knowing the inside information is it insider trading?
- foobarqux 12y ago
  But where would that activity come from in cases other than the relatively few activist and hostile takeovers?
  - apaprocki 12y ago
    Why there is a sudden surge in options activity with no underlying stock movement or news could be very, very specific to the stock and requires understanding of why that might happen. I'm not sure computers have all the info they need (at this point in time) to make that determination with precise accuracy. But, you can simply ask the computer to notify you when it occurs so that you can use your brain to try to make sense of it.
    - foobarqux 12y ago
      The question is how could that movement be a result of impending M&A activity without insider information?
      - Bootvis 12y ago
        Well observations of public information that are not widely disseminated or are hard to interpret. For example 1) Change in behavior of insiders because of regulations which leaks information, e.g. sudden silence on a certain subject 2) Observed activity of key persons, e.g. the CEO of a company being spotted with other CEO's Mosaic theory[1] allows such things under the right circumstances and this would influence price. [1]: http://en.wikipedia.org/wiki/Mosaic_theory_%28investments%29 http://en.wikipedia.org/wiki/Mosaic_theory_%28investments%29
      - apaprocki 12y ago
        e.g. just from a few days ago: https://news.ycombinator.com/item?id=7866930 https://news.ycombinator.com/item?id=7866930

by Bootvis 12y ago

deleted 12y ago

[deleted]

Bootvis 12y ago
It's at least unethical and probably forbidden. Furthermore I believe it is a breach of fiduciary duty. Maybe these friends tell their friends and this leads to the deal being canceled.

apaprocki 12y ago

Also if you have the raw feeds you can try to detect suspicious activity and then use that activity as a signal for your own trades. If you trade based upon public data (what winds up being insider trading) without knowing the inside information is it insider trading?

foobarqux 12y ago
But where would that activity come from in cases other than the relatively few activist and hostile takeovers?
- apaprocki 12y ago
  Why there is a sudden surge in options activity with no underlying stock movement or news could be very, very specific to the stock and requires understanding of why that might happen. I'm not sure computers have all the info they need (at this point in time) to make that determination with precise accuracy. But, you can simply ask the computer to notify you when it occurs so that you can use your brain to try to make sense of it.
  - foobarqux 12y ago
    The question is how could that movement be a result of impending M&A activity without insider information?
    - Bootvis 12y ago
      Well observations of public information that are not widely disseminated or are hard to interpret. For example 1) Change in behavior of insiders because of regulations which leaks information, e.g. sudden silence on a certain subject 2) Observed activity of key persons, e.g. the CEO of a company being spotted with other CEO's Mosaic theory[1] allows such things under the right circumstances and this would influence price. [1]: http://en.wikipedia.org/wiki/Mosaic_theory_%28investments%29 http://en.wikipedia.org/wiki/Mosaic_theory_%28investments%29
    - apaprocki 12y ago
      e.g. just from a few days ago: https://news.ycombinator.com/item?id=7866930 https://news.ycombinator.com/item?id=7866930