Topic > Argumentative Essay on Insider Trading - 716

Some argue that making decisions based on specific, inside knowledge is unfair to other investors. Others think that it is not the fault of the insiders if they have access to additional information just because they work for a particular company and should be able to make their own decisions based on the information available to them. On both sides of the issue, insider trading can be extremely difficult to prove. How do you really know if an insider made their trading decision based on the special information they knew? Maybe it was just a coincidence when they decided to buy or sell their shares. The U.S. Securities and Exchange Commission monitors the market to try to detect insider trading by examining the trading volumes of certain securities. Stocks can rise or fall significantly after relevant news is announced to the public. But when volumes change dramatically without new information being released to the public, the SEC takes it as a warning sign. They can then begin to investigate and find out why unusual trading patterns are occurring to see whether or not it is illegal insider trading activity. When insiders trade their company's securities, the transactions must be registered with the SEC as another way to track insider trading in the market. Insider trading is a complex topic and there are many arguments in favor of both sides. The three main arguments against