Business, Management and Accounting
4 years ago

Insider trading that lowers overvalued stocks allowed, raising banned: study.

1 view
Regulation
A Middle Ground on Insider Trading
Thomas Lambert

Paper Summary

Insider trading should be allowed when it lowers the price of an overvalued stock, but not when it raises it. This is because overvalued stocks can harm shareholders in the long run, while the impact of undervalued stocks is uncertain.

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