Why is insider trading so bad
The other type of insider trading is wrong and here is why. Endangers Transparency One of the principal tenants of capital markets is transparency, meaning that all investors have access to the The fact is that there are insurmountable logical problems with the very notion of insider trading. It's illegal for an insider to buy on learning of his company's secret scientific breakthrough. This is compounded by the fact that the current state of insider trading law is confusing and counterintuitive — in large part because there is no statute prohibiting it. Instead, the law of insider trading has been built by the courts over the past 80 years, based on a Depression-era law banning securities fraud.