Hacker News Reader

Comment by candiddevmike | Hacker News Reader

Isn't this considered insider trading? You'd think there should be a blackout period around any kind of layoff, similar to how they do with earnings.

View on HN

How is it insider trading? He sold the stock after the material became public knowledge. He didn't have any insider information

He always has insider information when he's the CFO, don't you think?

And if that information that is unknown drives the stock price down, _then_ he is insider trading

But he has the power to create the material...

So? That doesn't make this insider trading

>He sold the stock after the material became public knowledge.

Are there rules about how long you need to wait after the news goes public to sell? Otherwise, it still seems kind of unfair because you could sell 100 milliseconds later before the market can react.

You put up your sell order in 100 milliseconds. The market then reacts as long as it takes to react. Stocks don't instantly settle

If you sell for below market price then the order will be filled quickly and you'll be ahead of the pack.

He traded on publicly available information, didn't he? Like, literally, what's the difference between him or you logging into a trading platform and issuing a sell on Tuesday morning?

He had shares prior and he didn't sell them before layoffs which he could have. I think that would be the difference.

You literally want to indict someone based on something they hypothetically could have done, not what they actually did? Good thing the courts doesn't work that way..

Choosing to time layoffs so they happen when the stock price boost happens during your trading window is deep in a legal gray area.

No. As far as I know, blackout periods are usually before a major announcement, except in cases like a change in leadership. In any case, blackout periods are defined and enforced by companies, they are not rules made by the SEC: the purpose is to avoid the appearance of impropriety. This is not insider trading either, since insider trading involves making trades based on non-public information, and this all happened after the information was made public.

Too early to tell. If the company is in far worse condition than the public realizes, than maybe. But this could just be rebalancing due to the increase in price.

Reply on news.ycombinator.com