http://www.elitetrader.com/vb/showthread.php?s=&postid=1101041#post1101041 I agree, posting this thread was not a great idea. And if you trade this guy's co. at any point in the next year or so, it is considered inside information.
Insider information has a negative connotation, a la Gordon Gekko. So if one works for a company and is privvy to certain data, he is not allowed to act upon it before the general public?? William Gates III has announced his "retirement" (is it me or did anyone else realize that this is the second time Mr. Bill made this announcement) again to pursure his charity works. He is liquidating 20 million shares of his personal stake every quarter. Cashing out or does he know something the rest of us does not?
What I would do? Exploit it and profit from it after I deleted this thread... Just kidding...I would do the right thing and sell the info to a Martha Stewerts new broker... Welcome to America... Hey did that guy know you were a trader? If he did I would fade him...
Personally, it's a moral issue. I don't trade inside info because it's bad for markets in general. I've occasionally had to stop someone from trying to give me such info because it effectively keeps me from being able to trade the stock. AFAIR from the IMCL/MS debacle, being the tip-ee and trading off of it is not unlawful, though. The tip-er (the insider) is the one that is breaking the law.
You could: 1. Post the information here, then it would be public and not insider info anymore. 2. Instead of just buying the Aug puts, you could also buy Aug calls. Your profit would be less, but you could always deffend yourself that you are playing a strategy and not a lucky directional bet. 3. Tip off somebody else, and let him do the deal. Make sure that the connection between you is hard to prove...
I would love to know the company, because I would short it regardless of pending bad news. Why? Because the CEO is an idiot. I have been close to four CEO's of publicly traded companies, and none of them would ever let information like this out in a situation such as you described. If the CEO is making bad decisions like that, the company is in trouble.
IMO..There's nothing to be done...The price of stock has already been handicapped by the floor anyway...That's why it's called speculation..Traders have already handicapped whatever that CEO is going to do before he even knows it...By the time he makes whatever announcement,or decides anything.. Traders have pulled money off the table and have moved on..... Insider Information is BS...If the infomation is worth a damn. The move is gone because traders have already moved the price stock on the speculation of news.....Made money, Lost money, and moved on!
Lets say our government is going to pass along a nice size contract to a small cap defense contractor.....The members of congress who are privledged to this information are legally allowed to buy the equity in this stock before the rest of the public and possibly even the company find out about this contract....Is this considered inside information? Of course it is.....and until this joke of an exception to the inside information trading laws get changed to make it fair and balanced for everyone (public, investment banks, hedge funds and congress alike) we are doomed to cover ups and scandals similiar to the John Mack situation that happened this week..... Example:-----CA Democratic Senator Dianne Fienstien and her husband Richard Blum who owns 75% of all voting shares of (PCR---Perini Corp).....Feinstein is a member of the U.S. Senate Committees on: Appropriations, Rules and Administration, Intelligence, Judiciary, and Energy and Natural Resources. In April 2003, the U.S. Army Corps of Engineers gave $500 million to Perini to provide services for Iraq's Central Command. A month earlier in March 2003, Perini was awarded $25 million to design and construct a facility to support the Afghan National Army near Kabul. And in March 2004, Perini was awarded a hefty contract worth up to $500 million for "electrical power distribution and transmission" in southern Iraq. Feinstein, who sits on the Senate Appropriations Committee as well as the Select Committee on Intelligence, is reaping the benefits of her husband's investments. It's a disgusting display of war profiteering.....Not only is it inside information, but it is creating real positive actions through the use of political power and tax payers dollars for ones own portfolio... But what I find of even greater interest is the fact that the New York Times published an article earlier this month reporting that the Perini Corporation was awarded its $100 million contract "confidentially" -- much in the same manner by which Bush administration has been disbursing business to other companies it enjoys a close relationship with: "For some of the reconstruction work in and around Iraq, the United States Army Corps of Engineers confidentially awarded a one-year contract worth up to $100 million on April 1 to the Perini Corporation, which had revenue of barely $1 billion last year. The agency released a brief statement about the award on April 4, but Perini did not receive clearance to issue its own statement about the significant chunk of business until April 8. By then, its stock had climbed more than 40 percent." ("The Catch-22 Of Iraq Contracts," Diana B. Henriques, April 12, 2003, New York Times) ALSO News alert! has learned that the Perini Corp., a Massachusetts company controlled by an investment group headed up by California Democratic Sen. Dianne Feinstein's husband, banker Richard Blum, has become the focus of a lawsuit filed by the Los Angeles County Metropolitan Transportation Authority, or MTA, alleging massive fraud in the construction of the Los Angeles subway system. This one has big-time political implications. The lawsuit, which names as defendants Tutor-Saliba Corp., California's largest contractor, and the Perini Corp., owned by an investment group headed up by Blum, alleges that Tutor-Saliba-Perini used dummy minority business enterprises to land contracts on the subway portion of the 57-mile Los Angeles Metro Rail line. The lawsuit also alleges that the white-owned firms set up dummy companies that were "either not qualified or in whom they owned a disclosing interest." The lawsuit alleges that Tutor-Saliba-Perini worked with subcontractors to present false claims for work on the Los Angeles subway to obtain millions of dollars for additional payments. Didn't here about this on scandal on TV anywhere.... I post this incase you people still think we are a two party system always working against each other in the public eye, but really just a blue and red mix I like to call our purple government.... She even looks like a die hard right winger Bottom line I wish I could turn my dog from a $4 stock to a $30 in two years... $COSTAverageMAN