Yeah I remember this from taking L1/L2 but that was a while ago and I although I thought I always did well on ethics, I never got the highest category on either test.
Thats why I asked the question. I wasn’t so sure. Cinical trials can be in the grey area. For depression and oncology, its very difficult to gauge an effective drug. But, with Alzheimers and Cardio, some of the trials from what I know so far are working on disintegrating the plaques obstructing blood flow that cause the major problems with these medical issues. Alzheimers would be a slow grind to gaining effective results, but cardio would possibly show immediate results. My thought was if it was mosaic theory non-public non-material information or material non-public information. Apparently it is the latter.
There is no ‘worth it’ to me. I just won’t take the risk. I don’t want to do anything illegal or in the grey area and if it was legal everyone would not be doing it because most of these people don’t understand how to invest in profitable information in the markets. I’m not saying i’m an expert at that, but thought I could possibly use what I gain in one field to profit in another. Again, I’m not looking to get banned from two industries. I can’t pull a Mike Milken and bounce back.
Yeah thats what my trader friend said to me the other night after I talked with the Director and then Manager of Clinical research. I said to him that it could be insider trading. He said, well not if I trade on it. I was like no, man, thats still insider trading. He was like, well, no one will know if I just put in $10k and trade. I was like ‘I don’t know’, but in my mind a ‘definitely not’. I didn’t want to be too harsh to him.
I mean you’re a great guy and everything … haha … but yeah
I guess it depends on what country you’re in, but here in the US, and I believe also in Europe, insider trading is pretty much all illegal, unless you are a Congressman (though I believe that has also been changed, recently).
That doesn’t mean it doesn’t happen. It mostly adds up to generating plausible deniability. But - as Martha Stewart will tell you - plausible deniability doesn’t always work the way you planned, so remember to bring pastels and white linens to prison, since they can really brighten up a cell on those inevitable cloudy days.
I guess I really didnt know where the line was drawn between a) patient seeing success on drug b) independent firm seeing success on drug c) big pharma seeing success on drug and making concrete plans to act on it in a) it would only be a sample size of 1 and with b) you wouldn’t get the whole sample size, and c) is clearly insder trading, but as others stated above this clearly would be insder information until a press release or patent of some sort in this case. note to self: always carry pastels in case of immediate arrest
If you do it on your own as a retail investor then you’ll get you fked.
Best bet is to find a few investors, form a fund, hire a bunch of nerds. Then trade on the info. Make billions, and then payoff the SEC a few million when they catch you. Also make the nerdy Asian kid the fall guy for these trades. You get off scot-free.
Besides without knowing what ACE is really involved in we could just say its something you read on an anonymous internet forum. You didnt know it was actually true or not. Most people would laugh at you for following investment advice from a random on the interwebs
Ok, so reading more closely, you are now working at a company that does clinical trial research and you think the research results you see will have a material impact on some securities prices, You have no obligation to keep the results secret except for patient details and identifying data. You want to know if it is illegal to trade on this info.
I think the answer is yes, and it will be tough to argue that it isn’t insider trading if you work for the company and your trades line up with the research results and are profitable.
I think your best strategy is to do your best to make sure the research results find their way into the public sphere so that it is no longer non-public, and you make your trade at the open on the next day so as to be first in line after publication but definitively after the announcement. So release the report at 4:55 pm on a Wednesday and pull the trigger at the open on a Thursday or something. Even that may be verboten if you are the author of the study or on the team, but it might pass if you are just referencing the article in other research.
I’d talk to a lawyer about how to slice it, though. Jail is not a fun place, no matter how they try to make it look on adult websites.
I have a hypothetical question: Say you are aware of a drug trial, and you have no inside information on it. But you decide to carry out your own informal trial of the drug. It doesn’t have to be anything like cancer, it can be as simple as getting 10 of your friends to try out an acne cream or weight loss drug etc.
If the results are good, can you trade on that information?
Yes. The public is not entitled to your own analysis before you can act on it. However, I’m not sure the trial participants could.act on it.
If not, then a channel check in person would be illegal to trade on.
EDIT: the above presumes that you aren’t going to announce the results of your research to the public. If you act on the trade, then publish your results widely and then reverse the trade based on the market reaction. I’m pretty sure that’s illegal.
Even if you’re trading on the publically available information you still run the risk of blending your personal knowledge of the results vs. what is actually published to the public. Imagine if you buy heavily after phase I and it ends up going maintstream and purchased outright by big pharama… Would a jury really believe that you only acted on the information available at hand during phase I?