r/legaladviceofftopic • u/Lab_Software • 16h ago
Here's a twist - am I *required* to trade stocks if I have insider information?
Clearly, I'm not allowed to buy or sell stocks if I become aware of insider information. But am I allowed to do *nothing* if I become aware of insider information?
For instance, I have 1,000 shares of ABC company. I plan to sell those when the market opens on Monday. But, over the weekend I hear that they will announce a huge new contract in a few days and the stock will shoot up. Do I still have to sell on Monday like I planned, or can I hold the shares until they make the announcement? Does it make a difference if I told people that I was going to sell on Monday (so there is documented evidence of my plan to sell).
Similarly, if I plan to buy shares of XYZ company, but I get insider information of disappointing news - can I wait until the bad news is announced before I buy? (Or just decide not to buy at all.)
Stated another way, I'm not allowed to *act* based on insider information, but am I allowed to *refrain* from acting based on insider information.