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Yup it's a giant loophole alright and I don't see any answer short of
prohibiting insiders from ALL trading before news. Insiders at the
bellwether companies will always be able to find some stock or
derivative, other than their own stock, that's highly correlated and
will move on the news.
Even if they banned the insiders, the footprints left by third-party
co-conspirators would be faint at best. If I had bought a zillion INTC
puts yesterday, somebody might ask why. But, if I sold a truckload of
Naz futures and didn't have any relationship with INTC, it could have
been for any number of reasons and wouldn't sound any alarm bells.
--
Dennis
Bill Wynne wrote:
>
> I asked:
>
> >are INTC, and other insiders, restricted in any way from trading the NASDAQ
> >futures? It seems the major >components of the indices could use the
> >futures as a surrogate for insider trading.
>
> A private response said they can! Is this true? If so it is loophole
> insiders can drive a $100,000,000 truck through with ease. I'm amazed no one
> seems to care that hundreds of million$ may have changed hands over night on
> this deal, and yet a few ticks slippage can have folks frothing at the mouth
> for days.
>
> Bill Wynne
>
> Bill@xxxxxxxxxxxxxxx
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