Which one of the following statements is correct?
A)Company insiders are not permitted to trade their employer's securities.
B)Only tippers can be accused of illegal insider trading.
C)Tippees are permitted to trade securities based on information they know is private.
D)Trading on private information that you just happen to overhear is legal.
E)Any trading based on information known to be private is illegal.

Question

Quizplus · Accepted Answer

Insider trading involves the use of non-public or private information to make trades in securities, and it is illegal. Tippees (those who receive insider information from a tipper) are also prohibited from trading based on the information they received. Trading on private information that one overhears or any trading based on non-public information is likewise illegal. Company insiders may trade their employer's securities, but only if the trades are made in compliance with applicable insider trading regulations and policies.

Which One of the Following Statements Is Correct