Hypothetically, if I am working in XYZ company and If we know that my current company XYZ is working on a product which will get released sooner which is going to be a tough competition for ai from Microsoft and assume that MS stock will go down drastically if this product is released. Then, can I dump all MS shares with this insider secret knowledge from my company? Does it come under insider trading?
Literally the definition. Though I doubt your hypothesis that sound anyway.
Go read Insider Trading policies from your company.
Probably insider trading But I would strongly question whether the effects will be as significant as you assume. We tend to ascribe more importance to the things we are personally working on than is warranted, and the market has priced in much more information and many more risks than you probably think.
Yes
Thats not the definition of insider trading.
That is not correct. If OP has access to non-public company information that would influence a company’s stock price, even if that non-public information is from another company, and OP trades on that non-public information to their benefit, then that is indeed insider trading.
I am not a lawyer, I am not your lawyer, but… Yes. It is insider trading. You do not have to trade your company’s stocks or options to commit insider trading. Trading stocks of suppliers, customers, or competitors has a special name by SEC: “shadow trading” and is considered a type of insider trading.
If you are an IC, your knowledge is insignificant for predicting the stock price movements, therefore you can do all you want and it's not considered insider trading. The higher level you are (and nearer the CEO in the chain of command), the higher the chances that you are operating under insider information.
Insider trading is any knowledge of material value that the general public is unable to know. So knowing that a buyout of a company will happen in two weeks is insider knowledge. Sitting outside a competitors building and noticing who shows up in the parking lot and determining a buyout will happen is not. In the second case anyone could have theoretically done the same and gotten the knowledge. In the first you had to be an insider.
Definitely Insider trading doesn’t only apply to your company’s stock. 🤦
Yes