Black out trading windows working in tech

Amazon
TDzY75

Go to company page Amazon

TDzY75
Jun 14, 2021 10 Comments

I’m new to the industry working for Amazon but how do brokers (Schwab, Morgan Stanley, Fidelity etc..) prevent insider trading when employees of tech companies need pre-clearance from their respective employers for trading securities of where they work??

For example if I work at Amazon, I need pre-clearance to trade AMZN. Same for others working at different companies.

How does this process work ? Is there any collaboration done on the broker’s behalf where they don’t allow you to engage in trading activities for a particular security?? Does the employer notify the broker of which trades were pre-cleared??

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TOP 10 Comments
  • FB uses Schwab for the stock grants. Company-wide trade restriction periods are also directly enforced through Schwab. It'll say on the Schwab website that you can't trade FB. If you have other brokerage accounts, you can "accidentally" trade something you're not supposed to, and that can cause a trouble.
    Jun 14, 2021 2
    • Amazon
      TDzY75

      Go to company page Amazon

      TDzY75
      OP
      Yes, could you imagine if a FB employee traded FB stock using Fidelity or Robinhood when they aren’t allowed to do so! How would they get caught??
      Jun 14, 2021
    • OP, are you serious about trading employer's stocks outside the window? Your brokerage account, whatever the one you use, will have the SSN associated with it, and it's very easy for, say, IRS to figure out that you did something illegal. Pretty sure it's not just a company level policy. Even in terms of risk reward trade-off it makes no sense to attempt this.
      Jun 14, 2021
  • Gonna go ahead and stop you now...don't do it. Not worth jail.
    Jun 14, 2021 0
  • Amazon
    LUX1E

    Go to company page Amazon

    LUX1E
    Don’t trade shares you work for
    Jun 14, 2021 0
  • Google / Eng
    AOjK47

    Go to company page Google Eng

    AOjK47
    At Google there's a "trading window" when you can sell stocks. You can also register to have your stocks autosold.
    Jun 14, 2021 1
    • Amazon
      TDzY75

      Go to company page Amazon

      TDzY75
      OP
      I heard everyone who is L8 or higher has stricter trading restrictions and tighter window periods imposed of them! Is that true?
      Jun 14, 2021
  • You can trade msft stocks while working for msft...
    Jun 14, 2021 1
    • Uber
      itgksn

      Go to company page Uber

      itgksn
      You can even trade in derivatives of Microsoft. On the other hand, average employees have zero info about the business performance
      Jun 14, 2021