Angie · learn
Insider trading
Trading on material information the public does not have yet. Illegal, and the reason company insiders must file their trades publicly.
Updated 2026-09-05
Insider trading is buying or selling on material information the public does not have. Material means a reasonable investor would want to know it; nonpublic means it has not been disclosed. Both conditions have to hold.
Legal insider trading also exists and is informative. Officers and directors must file their own transactions publicly, which makes their buying and selling observable. Cluster buying by several insiders is one of the few genuinely useful signals available for free, on the reasoning that people sell for many reasons and buy for one.
See also
- SEC — The federal securities regulator. Its disclosure regime is why public financial statements exist at all, and therefore why any of this can be computed.
- Prospectus — The disclosure document for a securities offering. It is written by lawyers to be complete rather than readable, and the risk factors section is the part worth reading.
Educational content, not investment advice. Angie explains how a valuation is built so you can judge it yourself. What you do with that is your call.
