Shockingly no, insider trading applies to “material, nonpublic information” about the company and its economic actions. If you’re trading based on advance knowledge of a subscription price hike or a change in recipe, that’s insider trading. If you’re trading based on people getting mad for literally no reason or a company’s continued compliance with a law or social norm, that’s not insider trading.
No, shorting a stock, yelling “hey everyone, you should all boycott this company because of vibes,” and then profiting when people inexplicably listen to you is legal.
Nah it even theoretically benefits the market’s information/price discovery in capitalist theory. “Activist short sellers” stand to make a lot of money by exposing unknown true negative information about a company. Straight-up lying is prohibited as securities fraud, and ultimately if you publicize something untrue or unimportant (“woke” accusations) the price will return to normal as the market recognizes the information was BS. So there’s a bunch of firms that essentially exist to scrutinize the finances and activities of other companies, and if their “audit” finds a problem they get paid and offender gets punished.
(The line between straight-up fraud and overenthusiastic PR for fluff is not clear.)
Isn’t that illegal? :pondering-the-line:
Shockingly no, insider trading applies to “material, nonpublic information” about the company and its economic actions. If you’re trading based on advance knowledge of a subscription price hike or a change in recipe, that’s insider trading. If you’re trading based on people getting mad for literally no reason or a company’s continued compliance with a law or social norm, that’s not insider trading.
No, shorting a stock, yelling “hey everyone, you should all boycott this company because of vibes,” and then profiting when people inexplicably listen to you is legal.
Nah it even theoretically benefits the market’s information/price discovery in capitalist theory. “Activist short sellers” stand to make a lot of money by exposing unknown true negative information about a company. Straight-up lying is prohibited as securities fraud, and ultimately if you publicize something untrue or unimportant (“woke” accusations) the price will return to normal as the market recognizes the information was BS. So there’s a bunch of firms that essentially exist to scrutinize the finances and activities of other companies, and if their “audit” finds a problem they get paid and offender gets punished.
(The line between straight-up fraud and overenthusiastic PR for fluff is not clear.)