insider trading
The illegal practice of trading on the stock exchange to one's own advantage through having access to confidential information about a company.
This crime involves exploiting privileged, non-public information to make personal financial gains in the stock market. It undermines market fairness and investor confidence, as it gives an unfair advantage to those with 'inside' knowledge.
Word relationships
- fair trading: Trading based on publicly available information and equal access.
Collocations
- allegations of insider trading
- prosecute for insider trading
- insider trading scandal
Example sentences
- "The CEO was convicted of insider trading after it was proven he sold his shares just before the company announced its disastrous quarterly earnings." Reporting on a financial scandal.
- "Strict regulations are in place to prevent insider trading and ensure a level playing field for all investors." Discussing market ethics.
Memory hook
INSIDER TRADING is when someone on the 'INSIDE' of a company uses secret info to 'TRADE' stocks unfairly. Inside secret trade
When not to use
Do not use 'insider trading' for legal trading by company insiders (e.g., executives buying shares) if that trading is disclosed and follows regulations. The 'illegal' aspect is key.
Fun facts
- Martha Stewart, the American businesswoman, was famously convicted of obstruction of justice and making false statements related to an insider trading investigation, though not directly for insider trading itself.
Explore more words
whistleblower, Share, graft, collusion, Arbitrage, embezzlement
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