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Excellent example, OM! I hadn't known about this clause before, but now you
made it crystal clear. Thanks.
Michael Suesserott
-----Ursprüngliche Nachricht-----
Von: editorial@xxxxxxxxxxxxx [mailto:editorial@xxxxxxxxxxxxx]
Gesendet: Friday, September 22, 2000 23:11
An: Omega List
Betreff: Re: INTC/NDX
-- BW wrote:
> Understood, but INTC, MSFT, CSCO, ORCL, and others
> have a VERY high correlation with the NDX. What is
> the law concerning them trading that?
I don't understand the complaint? Remember, "insider trading", per se, is
no problem - it simply must disclosed. It becomes a problem only when it is
done "in breach of a fiduciary duty or other relationship of trust and
confidence".
No one trading the NDX based on their knowledge of INTC was violating a
fiduciary duty to INTC shareholders. Without a breach of fiduciary duty,
there's no problem with insiders making trades....
Let me give an example. Let's say that your Uncle has a big corn farm. You
decide that you want to take a look at the crops and trade some corn futures
based on the results of your inspection. Now, let's say that you make big
money doing that. Has there been an "insider" trading violation. I mean,
after all, you did have material information which was not publicly
available...
Answer: No, there's no violation. Why? Because you did not neglect any
fiduciary duty.
Good trading,
OM (aka "Mr. Fiduciary")
P.S. - Derivatives and stocks abide by totally different sets of rules
anyway...
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