Insider Trading on the Rampage

Discussion in 'Wall St. News' started by archon, May 23, 2007.

  1. archon


    Yeah. Tell me about it. :cool:

    I've never understood why anyone would pay these fees. Unless your fund manager is smoking the market by several orders of magnitude every year, why would you bother? Unless you are caught up in the cache of saying that you're investing in a hedge fund, is it really worth it?
    #11     Jun 14, 2007
  2. Insider trading always has been and will be part of the business. figure out a good work around plan.

    #12     Jun 18, 2007
  3. archon


    I don't know. I think that's a bit of a platitude. Of course insider trading is a part of every market, but it doesn't explain the supposed surge that we are seeing these days in the options market. Who is making all of these shady trades? Why are they all showing up now? Is this really happening or is this just a media firestorm?

    ......or is it the HEDGEFUNDS?!?!?!

    Dum Dum Dummmmmmm......
    #13     Jun 27, 2007
  4. As a scalper, I kind of like insider trading... I can usually spot it in the prints and effectively trade "off it" (though I'm trading off public information, the market T&S/DOM data)...

    when a stock that might be a reasonable buyout target suddenly has 50,000 share stepping bids that keep getting filled and coming back, is trading 100x the normal volume, has market orders sweeping the book for 40 cents, and the options volume - especially the calls - is significantly higher than normal, someone probably knows something important.

    Not that I approve of insider trading, it's criminal activity which cheats investors, traders, and short sellers, but that one can trade off of it.
    #14     Jun 27, 2007
  5. RedDuke


    Do not reply on prints too much for stock trading. Big transactions are not showing up there. Institutions are allowed to trade large chunks between each other, and these trades will never show up on tape.
    #15     Jun 28, 2007
  6. They're required to report them within 60 seconds on the consolidated tape. Whether or not they comply is a different matter, but the overwhelming majority of the volume going on in stocks is still going on at the exchange and through ECNs. Reading the tape can be imperfect, but I have several edges and/or setups based purely on the prints and/or open book which work extremely well. If you'd like me to discuss in more depth what kind of trades I get into, I'll start a thread or a PM explaining some recent trades of mine (both failures and successes) to show how what I saw could not have been seen without the tape and how it was improbable that dark pools and large block trades would have had a notable effect on the probability of my setups panning out.

    I suspect many insider transactions aren't done through crossing agencies, though I may be wrong as I have no idea what I'm talking about when it comes to actually executing illegal insider trades.
    #16     Jun 28, 2007
  7. RedDuke


    From what I heave heard, most of these trades are not reported, and yet there is nothing illegal about them based on current rules.

    But I have not seen this with my own eyes, so could be wrong.
    #17     Jun 29, 2007
  8. archon


    I think you have a better chance of predicting and trading off options volume than equity volume. Options volume is far more transparent. Also, there are certain outliers in the options market that are easier to spot.

    Insider trading in options tends to occur in relatively predictable time frames of a few minutes before the close and a few minutes after the open. If you see massive trades going on in those time frames, chances are that something shady is going on.
    #18     Jul 11, 2007
  9. Add Foxhollow to the ever expanding list of blatant insider trading.

    About an hour ago, FOXH announced they will be acquired for $25.92 per share.

    On friday, the stock popped almost 10% on 5 times the average daily volume. In the final 25 minutes of trading, the stock spiked $1.50 on a massive volume surge.
    #19     Jul 22, 2007