INSIDER DEALER Meaning and
Definition
-
Insider dealing, also known as insider trading or insider trading, refers to the illegal practice of trading securities (such as stocks, bonds, or options) based on material non-public information about a company. An individual who engages in this practice is commonly referred to as an "insider dealer."
Insider dealers typically work for the company whose securities they trade, or they may have access to confidential information through their close relationship with the company's management, employees, or shareholders. This privileged access allows them to gain valuable insights about the company's financial performance, strategic direction, or any impending news that could significantly impact the value of the securities.
The act of insider dealing is considered illegal and highly unethical because it grants the insider dealer an unfair advantage over other market participants who do not possess this confidential information. By trading on this insider knowledge, they can generate substantial profits or avoid significant losses, thereby undermining the integrity and fairness of the financial markets.
Regulatory bodies, such as the Securities and Exchange Commission (SEC) in the United States, enforce strict laws and regulations to prevent and prosecute insider dealing activities. Penalties for insider dealing can include criminal charges, hefty fines, disgorgement of profits, and even imprisonment in some cases.
In summary, an insider dealer is an individual who engages in the illegal and unethical practice of trading securities based on material non-public information.
Common Misspellings for INSIDER DEALER
- unsider dealer
- jnsider dealer
- knsider dealer
- onsider dealer
- 9nsider dealer
- 8nsider dealer
- ibsider dealer
- imsider dealer
- ijsider dealer
- ihsider dealer
- inaider dealer
- inzider dealer
- inxider dealer
- indider dealer
- ineider dealer
- inwider dealer
- insuder dealer
- insjder dealer
- inskder dealer
- insoder dealer
Etymology of INSIDER DEALER
The term "insider dealer" is a combination of two words: "insider" and "dealer".
The word "insider" refers to someone who has privileged or confidential knowledge or information about a particular situation, organization, or industry. In the context of trading on financial markets, an insider is someone who has access to non-public information that could potentially influence the value of certain securities.
The word "dealer" typically refers to a person or entity involved in buying and selling goods, often as a profession. In the financial world, a dealer is someone who facilitates the buying and selling of securities such as stocks, bonds, or derivatives.
When these two words are combined, "insider dealer" refers to an individual or entity that engages in trading securities based on non-public information, using their privileged position to gain an unfair advantage over other market participants.
