What Is Insider Trading? Explained in Simple Words
What Is Insider Trading? Explained in Simple Words Author: @nkit Insider trading is one of the most talked-about and misunderstood topics in the stock market. Many beginners hear this term in news headlines when a company executive or investor is caught by regulators. But what exactly is insider trading, why is it illegal, and how does it affect common investors like you? Let’s understand it in very simple terms. What Is Insider Trading? Insider trading means buying or selling a company’s shares using confidential, non-public information that is not available to the general public. An insider can be: Company promoters or founders Directors or senior management Employees with access to financial data Anyone who receives inside information from such people If these insiders trade shares based on unpublished price-sensitive information, it is considered illegal insider trading . What Is Unpublished Price Sensitive Information (UPSI)? UPSI is ...