Question

Sid, a director of Tech Software Company, learns that a Tech engineer has developed a new, exciting video game. Sid buys Tech stock and tells his friend Uri, who also buys Tech stock. When the new game is released three weeks later, Sid and Uri sell their stock for a big profit.
Sid would not be liable if he had waited to buy Tech stock until______

Answer 1

Answer:

Sid would not be liable if he had waited to buy Tech stock until "three weeks when the game was released".

Explanation:

Sid, by finding out about the development of a new and exciting video game, and then acting on that information by purchasing Tech stock, and also informing his friend Uri to do the same, has committed illegal insider trading.

He used non-public information (that had not yet been made available to the public) to make extra profit for himself and his friend, Uri.

If Sid had waited until the information became public three weeks later, before purchasing Tech stock, then he would not be liable for illegal insider trading.