Longman Dictionary of Contemporary English
Wiktionary
n. (context finance English) buying or selling security of a publicly held company by a person who has privileged access to information concerning the company's financial condition or plans.
WordNet
n. buying or selling corporate stock by a corporate officer or other insider on the basis of information that has not been made public and is supposed to remain confidential
Wikipedia
Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) by individuals with access to nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal. This is because it is seen as unfair to other investors who do not have access to the information, as the investor with insider information could potentially make far larger profits that a typical investor could not make.
The authors of one study claim that illegal insider trading raises the cost of capital for securities issuers, thus decreasing overall economic growth. However, some economists have argued that insider trading should be allowed and could, in fact, benefit markets.
Trading by specific insiders, such as employees, is commonly permitted as long as it does not rely on material information not in the public domain. Many jurisdictions require that such trading be reported so that the transactions can be monitored. In the United States and several other jurisdictions, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases, insiders in the United States are required to file a Form 4 with the U.S. Securities and Exchange Commission (SEC) when buying or selling shares of their own companies.
The rules governing insider trading are complex and vary significantly from country to country. The extent of enforcement also varies from one country to another. The definition of insider in one jurisdiction can be broad, and may cover not only insiders themselves but also any persons related to them, such as brokers, associates and even family members. A person who becomes aware of non-public information and trades on that basis may be guilty.
Usage examples of "insider trading".
The trouble is that such inside trading is illegal, and beginning in 1985, Wall Street was rocked by a series of massive insider trading scandals.
Why in hell do you think I made you president of my insider trading division?
When the scandal about Hillary's winnings in cattle futures emerged, I had my answer: They were apparently anxious to hide her profits, lest there be questions about insider trading - or for a quid pro quo with Blair of state action in return for private benefit.
Then she'd been told he was a suspected homosexual member of an insider trading group at the same time as she herself was assigned to an investigation upon which her entire future depended.
He was under criminal investigation for accounting fraud, stock manipulation, insider trading, and self-dealing.
Since their first visit, he had thoroughly researched securities fraud and insider trading.
Then, in 1985, Lake engineered an insider trading scheme in which the price was artificially jacked up in a bidding war between Universal Equity and a company secretly funded by Lake.