A Simple List of General Do's & Dont's of Trading: Message Board

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Strategies & Market Trends : A Simple List of General Do's & Dont's of Trading:

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To: shrift1p who wrote (716)	9/3/2000 8:30:20 AM
From: Arthur Tang	Read Replies (1) of 769

When does insider trading get caught by SEC? It is amazing how common investors never understood how SEC works? SEC works fraud detection based on informants. But some times the informants are brokers and dealers. This leads to discussion about the recent Intel scandal. It is never a problem in buying stock which you guessed that INTEL investment will move the stock. As a matter of fact, unless your broker knows, the stock may never even take off. But, the problem in this Intel story was that his friends bought options. The option dealers did not gain but lost money to the buyers. So, they blow the whistle; and SEC took action. This option whistle blowing happened often, when brokerages future investments or deals leaked. SEC generally caught people bought options and made it big. Options seldom allow people to make money. It is an insurance for hedge funds to keep prices stable. Options writers often threw money at the close to keep prices stable to take the money letting contracts expire. So, if you got the best of them, they don't like it at all. Off they go to SEC.

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