Insider Trading

[Shakespeare]

One thing I didn't notice was that the G&M now has insider trading tables. The data are taken from the System for Electronic Disclosure by Insiders (SEDI).

[blondo]

From the horses mouth

[Shakespeare]

Maybe I should change my avatar.....

[Shakespeare]

The Wealthy Valet

Knowing he was trading on insider information, Duic realized it wouldn't be smart to use his own phone. Someone could be monitoring calls to offshore banks.

Because few Irwin Toy shares changed hands daily, Duic told his broker at Banque Baumann & Cie, Leopold Kenens, to "subtly" buy as many as he could without drawing attention. "It was my intent...to fly under the radar," Duic later testified.

But the broker, whose command of English was evidently imperfect, didn't understand the word "subtly." Back at his office, Duic flinched in horror as he saw a trade flash on his computer screen that was about as subtle as a siren. As far as Duic could see, his broker had "executed probably the largest block trade in the history of Irwin Toy....I knew the party was over."

[DenisD]

Seem to recall that Ink Research insider info is provided free to TDW clients. Haven't looked at it myself tho.

[worthy]

"At an elite boy's school like Upper Canada College, the presumption of power is bred in the bone. Surrounded by the trappings of privilege once he achieved power himself, Rankin didn't think hard enough about the law ...."

In awhile that line might come in handy again.

[Donut]

I watched a comedienne last evening as she talked about insider trading and she said "we all do it". She says the difference is "rich people talk to other rich people about rich people things and poor people talk to poor people about poor people things". She says "my cousin works at WalMart. She phones me up and says "don't you buy that stuff today girl - it's going on sale for half price next week so wait till then to buy it". She says "that's not much different than what Martha Stewart went to jail for".

And it's probably not.

[StripBond2]

"At an elite boy's school like Upper Canada College, the presumption of power is bred in the bone. Surrounded by the trappings of privilege once he achieved power himself, Rankin didn't think hard enough about the law ...."

Someone (Reynolds?) might want to write a book on the "influence" of UCC (and its more famous graduates) on the Bay Street world.[/quote]

[Oliver]

I was aware of a couple of the suspicious stock runups, but was unaware that such aberrant trading patterns were so wide spread.

63% of mergers had suspicious trading patterns -> Wow!

If one assumed 1/3 of the situations were not insider trading, that leaves one with insider trading in 42% of the mergers valued above C$200 million.

Oliver

http://bloomberg.com/apps/news?pid=2060 ... refer=home
`Suspicious' Trades Precede Most Big Canada Mergers, Study Says
By John Kipphoff and Joe Schneider

March 22 (Bloomberg)

...That unusual trading wasn't so unusual for the Canadian market. Aberrant trading patterns preceded 33 of the 52 Canadian mergers valued at more than C$200 million ($172.6 million) last year, says a study by Measuredmarkets Inc. for Bloomberg News. Those patterns could indicate insider trading.

``Insider trading goes on all the time,'' says Stephen Jarislowsky, 81, chief executive officer of Montreal-based Jarislowsky Fraser Ltd., which manages about C$63 billion. ``There's no real surveillance.''
...
The rate of unusual trading found in Canada -- 63 percent -- was higher than in the U.S.

PS Not sure which forum this belongs in.

[petermed]

" ``Insider trading goes on all the time,'' says Stephen Jarislowsky, 81, chief executive officer of Montreal-based Jarislowsky Fraser Ltd., which manages about C$63 billion. ``There's no real surveillance.''

The rate of unusual trading found in Canada -- 63 percent -- was higher than in the U.S., where a Measuredmarkets study last year flagged 41 percent of comparable mergers. The London- based Financial Services Authority said March 7 that insider trading may have preceded almost 25 percent of U.K. merger announcements in 2005....

The 33 Canadian stocks that Measuredmarkets says showed aberrant trading patterns before takeover announcements included La Senza; Shell Canada Ltd., the country's third-biggest oil company and target of a C$8.7 billion bid from parent Royal Dutch Shell Plc; and Western Silver Corp., bought by Glamis Gold Ltd. for C$1.2 billion."

http://www.bloomberg.com/apps/news?pid= ... fer=canada

How's an Outsider going to beat the "odds" in favor of the Insiders? It would seem to me that the first thing an investor would need to know is: is there Insider Trading and manipulation in the investment vehicle I am considering? How does one find that out? Canadian regulators don't seem to care.

[kcowan]

...How's an Outsider going to beat the "odds" in favor of the Insiders? It would seem to me that the first thing an investor would need to know is: is there Insider Trading and manipulation in the investment vehicle I am considering? How does one find that out? Canadian regulators don't seem to care.

First of all, if you are a value investor, this should not impact you seriously. If you are a market timer, then I recommend you follow the insider trading reports and jump in when you see a serious uptick. One caution: lots of insider trading is the result of options expiring, trading lockups expiring, and asset allocation models being followed.

[investoid]

I think this article brings up more of an issue than just market timing - how can you trust the information being presented to the market as the 'complete picture' of a company?

The problem is when insiders dump or buy before some material information is released. There's little time between action and news release, so looking at insider trading reports do nothing since they're delayed by over a month.

This type of action is illegal, but the OSC doesn't have the resources (or some may say the desire) to actively pursue these types of cases. That is what the article is getting at.

So, even if you're a value investor and have done your due diligence, you can still be materially affected by insider trading (both positively or negatively).

[Tanstaafl]

Insider trading in Canada. No, its just the high table getting first dibs on the buffet of easy money being given away. The regular investors(aka the general public) always sit furthest away. Its not illegal, its business as usual in Canada.

[Knowsitall]

It does not suprise me.

Society is in complete moral and social breakdown.

Government politicans are proven crooks,the public service serves itself,professionals from almost every profession have been caught either stealing ,sexual abusing or other hidiouus crimes.

Mankind is hard pressed to find anyone or anything adhearing to simple basic morality anymore.

AsI grow older and hopefully wiser I realize that the world is in trouble big time.

[kcowan]

...So, even if you're a value investor and have done your due diligence, you can still be materially affected by insider trading (both positively or negatively).

Insider trading usually just accelerates what the market is likely to do anyway. It can hurt you as a market timer (but it might improve your profits as a day trader because of more rapid swings) but it will not hurt a value investor because downward swings are considered temporary and you ride them out.

[blonde]

WOW!!!...Surprise...

STUDY my 5 Guiding Principles...

'The Need to be in the Loop...Insider Info'...is principle #3.

The Guiding Principles = SUCCESS...MEGA-SUCCESS

Dont Trust Everybody.

Money Talks. (Is this a principle?)

BTW, what Canada needs is still more 'believers'.

BTW2, good to see U back KIA...where U been?

BTW3, trust me, believe me.

[investoid]

Insider trading usually just accelerates what the market is likely to do anyway. It can hurt you as a market timer (but it might improve your profits as a day trader because of more rapid swings) but it will not hurt a value investor because downward swings are considered temporary and you ride them out.

That's not always true, especially if fraud is involved as well as insider trading (eg. Enron) - some companies go down and stay down.

The whole point of (successful) insider trading is to take advantage of today's over/under-valued price by buying/selling without materially moving the price. I don't see how that 'accelerates' anything. If the stock's illiquid then I can see how insiders trying to take advantage of private information would accelerate the movement in a stock since they will materially affect the buyer/seller market, but if it's a large cap company with high volume then it's unlikely anything would be noticed by the market.

[kcowan]

I don't see how that 'accelerates' anything. If the stock's illiquid then I can see how insiders trying to take advantage of private information would accelerate the movement in a stock since they will materially affect the buyer/seller market, but if it's a large cap company with high volume then it's unlikely anything would be noticed by the market.

...So, even if you're a value investor and have done your due diligence, you can still be materially affected by insider trading (both positively or negatively).

I think we are in violent agreement. The issue is that you what to be an insider. Sorry I missed that. Stick with large caps if you don't like insider trading. And never forget trailing stop loss orders. That made a bundle for Enron investors.

[Knowsitall]

Hi Blonde,

Nice to be back after a four month bouth with a bacteria infection which was most difficult to shake.

Actually it made me realize again how fragile life really is.One day you are sailing alonng at a clipping pace and boom some sickness wacks you.

I am back in action now none the worse but a little wiser.

The ironic part of my iillness was it was picked up in the few chartible volunter jobs I do.

I sat on a patients bed to read to him for about 10 minutes and within 3 weeks I had his malady.

It's nice to be nice but in voluntteer work,especially around hospitals or visiting those sick at home it is extremly important to take great care as I so sadly learned.Anyway I enjoyed doing it but now feel health trained pros got to do it.My daughter the nurse and my brother's son the specialist in internal medicine both really gave me a dressing down about the need to care for oneself first.I could have passed the bug quickly to others but quick medical intervention shut me down.

At the same time I was floored by the results of my stomach and bowel light examinations this year which indicated the 3 pylops removed were the threshold of my entry into having cancer.There testing of biops can tell the docs a lot about where arre health is heading.

Anyway nice to be back and am slowing getting back into the posting mood.

Be careful out there.

Chairs

[Norbert Schlenker]

Chairs, good to have you back and glad you've recovered. You even sound mellower.

As we're off topic, perhaps a moderator can cut this out of this thread.

[dusty2]

Canada has a reputation for 'looking the other way', when it comes to stock swindles. I don't think anything has been done about Bre-x, yet and people lost hundreds of millions. It's like the lottery scandal going on in Ontario now - the government knew they were getting ripped-off - but decided to do nothing, until someone blew the whistle. Mostly, I think the lack of action is due to laziness.

[Knowsitall]

When it comes to filling their pockets it is definately incorrect to say the roque crooks are lazy.

What we have seen over the past several years are crooked pros in action at many different con games.These people rely on the lack of moral courage of others to report them or sometimes they just expand the frauds to include any who come upon it.

People,especially investors ,are seldom stupid but sometimes are misled by their own greed or need to keep their job.

The average thief does not compare in intelligence to a bag of hammers usually reserved intelligent IQ of a police officer or judge AND SOME LAWYERS.

No they are smart as foxes and as sharp as knives and quickly deploy many a investor from his savings.

U got to admit the judical system is Canada is a horse's arse.

[blonde]

Nice to be back after a four month bouth with a bacteria infection which was most difficult to shake.

Actually it made me realize again how fragile life really is.One day you are sailing alonng at a clipping pace and boom some sickness wacks you.

I am back in action now none the worse but a little wiser.

The ironic part of my iillness was it was picked up in the few chartible volunter jobs I do.

I sat on a patients bed to read to him for about 10 minutes and within 3 weeks I had his malady.

A MEGA-ATTA-Boy to KIA for doing the 'shake-a-bug'.

In this day and age, with the Global Economy in over-drive, it is a darn good idea to Look After #1.

The HCS works well...well, as long as a person is 'In the Loop'...Money Talks...Big-Time.

Was the 'patient' by any chance an ole lib regimer hocus pocus tree hugger?

I did some volunteer work in the early years of retirement...too many 'Milkers' in the sytem...the gimmie crowd luvs to cheat the 10%ers...the boomer Geritolers are taking it up a notch...today is better than tomarrow. All of this is not a good thing.

Don't Trust Everybody.

BTW, what Canada needs is still more 'believers'.

BTW2, trust me, believe me.

[blonde]

U got to admit the judical system is Canada is a horse's arse.

Systems under the command of the ole lib regimer hocus-pocus tree huggers were focused on the socialist mindset...full of Malarky...it's in their genes...it is their culture...it is their way-of-life...they walk-like-a-duck...and they sqwak like-a-phycken-duck...and THAT is not a good thing.

Improvements are being made to the 'judicial system' as you read this post...Mr Stephen Harper, and HIS dedicated TEAM are continuously looking for flaws and correcting them in a short time cycle. Now, THAT is performance.

Stay tuned...there are better days ahead...

Don't Trust Everybody.

BTW, trust me, believe me.

[uhoh]

not banks...but from today's globe:

Breaking News from The Globe and Mail
Pet food insider sold shares before recall

KEITH McARTHUR

Tuesday, April 10, 2007

The chief financial officer of Menu Foods Income Fund says it's a "horrible coincidence" that he sold nearly half his units in the troubled pet food maker less than three weeks before a massive recall of tainted pet food.

Insider trading reports show that Mark Wiens sold 14,000 units for $102,900 on Feb. 26 and Feb. 27. Those shares would be worth $62,440 today, based on yesterday's close of $4.46 a unit.

That represented 45 per cent of Mr. Wiens's units. After the sale, he still owned 17,193 units and options to purchase 101,812 units, according to insider trading reports.

"It's a horrible coincidence, yes . . ." Mr. Wiens said yesterday.

http://www.globeinvestor.com/servlet/st ... 0/GIStory/