Insider trading is the buying and selling of securities based on information that has not been made available to the general public. Because insider information gives an investor an advantage over others, it is illegal and punishable by law.What is insider trading and is it illegal?
Insider trading is the buying or selling of a security by someone who has access to material nonpublic information about the security. Insider trading can be illegal or legal depending on when the insider makes the trade. It is illegal when the material information is still nonpublic.