Hacker News new | ask | show | jobs
by kevinmchugh 876 days ago
If I work for Apple and I'm on the special secret new Apple Glasses project, I reasonably know that when the product is announced the stock is going to go up. That information belongs to Apple, not me. Apple could sell more shares to capitalize on the announcement. By buying shares before the announcement, I'm capturing some of the gain that should be Apple's.
4 comments
filoleg 876 days ago
That's why companies like Apple have very strongly enforced rules related to this for their employees, like blackout windows on trading AAPL shares and not allowing them trading AAPL shares at all. And there are even more restrictions for those working on certain teams and in certain areas (e.g., finance/accounting). Buying/selling right before the big announcement or earnings reports is straight up not allowed.

I don't know the actual dates for Apple (as I only have friends working there, I haven't worked there myself, and I didn't quite care to ask for the exact length of trading blackout windows). But I know for a fact myself that at Google you get a trading blackout window that starts around 3-4 weeks before the quarterly earnings announcements and ends around a week or so after. And you are not allowed to trade GOOG options at all while an emlpoyee, not even outside of those trading blackout windows. There are additional blackout windows as well, but that's beside the point, and I don't remember them off the top of my head. And that's just for a run-off-the-mill software engineer working on an internal infra product that isn't some super-top-secret thing.

link
philwelch 876 days ago
An employer should be (and AFAIK is) free to contractually obligate you not to front-run their own trading strategies. There’s no need for a federal criminal statute that, as far as I can tell, isn’t even primarily motivated by this use case.
link
HPsquared 876 days ago
If the company itself was to buy its own stock based on non-public information, wouldn't that also be insider trading? The corporate entity itself is, like, the ultimate insider.
link
cozzyd 876 days ago
Or if you are in a position where you can sabotage it somehow (introduce a bug in an update that calls the HCF instruction)...
link