A Middle Ground on Insider Trading

Thomas A. Lambert

University of Missouri - School of Law

January 11, 2010

Regulation, pp. 44-49, Winter 2009-2010

The debate over insider trading usually proceeds in all-or-nothing terms: either all insider trading should be permitted by law or none should. This article argues that the law should permit insider trading that decreases the price of an overvalued security or equity, but should prohibit insider trading that would increase that price. The reason for the different treatments is that over-valued equities often have a long-term negative effect on shareholders while the long-term effect on undervalued equities is ambiguous.

Number of Pages in PDF File: 6

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Date posted: January 12, 2010  

Suggested Citation

Lambert, Thomas A., A Middle Ground on Insider Trading (January 11, 2010). Regulation, pp. 44-49, Winter 2009-2010. Available at SSRN: https://ssrn.com/abstract=1534716

Contact Information

Thomas Andrew Lambert (Contact Author)
University of Missouri - School of Law ( email )
Missouri Avenue & Conley Avenue
Columbia, MO 65211
United States

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