1

Any jurisdiction is fair game, but I’m interested in the United States

If one has insider information that would meaningfully influence their choice to buy/sell a stock, there might be restrictions on when they can trade.

However, does that apply to goods, such as vehicles? Imagine someone areas going to purchase a car for $X, but they learn (via legally obtained insider information) that the company is planning to drop the car price by, say, 20%. Are there any restrictions on them buying the car there?

Or, for a slightly different example, if someone was buying cars (legally) to resell them, and they had insider info that car prices from a company would rise by 20%, would it be illegal for them to purchase ahead of the rise when they otherwise wouldn’t have?

Trish
  • 50,532
  • 3
  • 101
  • 209
cocomac
  • 396
  • 3
  • 12

2 Answers2

3

No

The crime is defined in s1043A of the Corporations Act applies only to financial products which includes include securities, derivatives, interests in managed funds, stocks, bonds and superannuation products.

Dale M
  • 237,717
  • 18
  • 273
  • 546
2

Insider trading laws apply to both securities and commodities.

This can include shares of ownership in corporations, it can include bonds, and it can include derivatives. Violations involving these assets are enforced by the Securities Exchange Commission (SEC).

Insider trading laws can also include publicly traded commodities, such as gold, grain, oil, and pork bellies, some or all of which are "goods" within the meaning of the Uniform Commercial Code. These are fungible physical items, although the buyers and sellers rarely see the actual physical items that they are trading. These violations involving commodities are enforced by the Commodity Futures Trading Commission (CFTC).

Insider trading is not normally applied to isolated transactions in physical goods, even if they could be considered commodities (where insider trading laws could conceivably apply), or to interests in closely held businesses, which are securities but are rarely actively traded.

ohwilleke
  • 257,510
  • 16
  • 506
  • 896