Insider

An insider is someone who trades a security on the back of knowledge unavailable to the world at large - usually to make a profit but sometimes to prevent further losses.

Insider dealing was only specifically made illegal in the UK under the Companies Act 1980 but there have been only a handful of prosecutions.

Cynics will tell you that the practice remains widespread - quite often there is a share price rise of a company which is about to face a takeover bid. This may be coincidence, but it may also be that someone with inside information is dealing.

Bodies such as the London Stock Exchange and Financial Services Authority can investigate unusual share price movements. But experienced watchers of the London stockmarket say despite this too may insiders get off the hook!

Share prices can be found in Stockmarket .

See Also: Online share dealing service Stockmarket Centre

Last Updated: November 2007 © Moneyextra.com

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