[HN Gopher] Is Stock Market Rigged? Insider Trading by Executive...
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       Is Stock Market Rigged? Insider Trading by Executives Is Pervasive,
       Critics Say
        
       Author : lifeisstillgood
       Score  : 35 points
       Date   : 2021-10-02 21:23 UTC (1 hours ago)
        
 (HTM) web link (www.bloomberg.com)
 (TXT) w3m dump (www.bloomberg.com)
        
       | ojbyrne wrote:
       | This feels like an extended ad for tipranks.com
        
       | ldjkfkdsjnv wrote:
       | Nancy pelosi's trading returns beat every well known investor,
       | she is running far lower amounts of capital, but shes averaging
       | 70% a year. Meanwhile, the rest of us slave away at our jobs like
       | cattle, and listen to her speak on TV about "fighting for our
       | rights, justice, equality"
        
         | paulgb wrote:
         | Does that 70% figure come from someone modeling out her
         | portfolio based on the filings? I'd love to see it if it's
         | public. Just as a gut reflex that seems high even with someone
         | who had the amount of inside info she has, but not saying it's
         | impossible.
        
         | lisper wrote:
         | This sort of claim really requires a reference.
        
       | AlbertCory wrote:
       | > "In two decades the SEC hasn't brought a single insider trading
       | case involving trades made under a 10b5-1 plan."
       | 
       |  _Ladies and gentlemen of the jury: the defendant changed his
       | 10b5-1 plan multiple times, and one of those times he profited
       | hugely from it. The defendant 's excuse that his advisor told him
       | to do it and he needed the money for his daughter's college is
       | just unpersuasive._
       | 
       | Anyone see why a prosecutor might be reluctant to bring such a
       | case? It might well be true, but the jury may or may not stay
       | awake long enough to agree. Best to concentrate scarce resources
       | on cases you CAN win.
       | 
       | Note that I'm not saying insider trading is harmless; just that
       | it's like illegal drugs: no policies will stamp it out entirely.
        
       | imgabe wrote:
       | > Of the 496 trades [Filler has] made since 2014 in Alabama's
       | ServisFirst Bancshares Inc., where he sits on the board of
       | directors, and Century Bancorp Inc. of Massachusetts, where he's
       | the largest shareholder, 372 of them, or 75%, have shown a profit
       | three months later.
       | 
       | > Besides Filler, other TipRanks stars include Steve Mihaylo, the
       | CEO of telephone services company Crexendo Inc., where he owns a
       | $60 million stake. Mihaylo has turned a three-month profit on 83%
       | of his trades over the past five years even as Crexendo's shares
       | have seesawed.
       | 
       | We've also had an unprecedented bull market over the past 10
       | years. If you pick any random stock at any time and hold it for
       | three months, what are the odds that it will be worth more?
       | 
       | The article compares the returns to the S&P500, but that is the
       | net performance of those 500 stocks. You'd have to compare it to
       | the base rate of picking a random stock to see if it's actually
       | remarkable.
       | 
       | Maybe the S&P 500 performed lower because 75% of the stocks in it
       | went up and 25% went down. But that means that if you randomly
       | pick one stock, you'd have a 75% chance of it being one of the
       | ones that went up, and you'd outperform the S&P500. (Well, not
       | quite, maybe it could go up, but not as much as the S&P500 as a
       | whole. But still, most of the stocks that go up, would have to go
       | up more than the average of the whole index in order to
       | compensate for the ones that go down)
        
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       (page generated 2021-10-02 23:00 UTC)