Exercise
Match each term to the appropriate securities violation
- A. Insider trading
- B. Selling away
- C. Improper outside business activity
- D. Market manipulation
- E. No violation occurred
- 1. _ Two agents who work at the same firm enter an agreement in which one agent buys 100 shares of a security at $100, while another agent sells 100 shares of the same security at $100.
- 2. _ A client is made aware of material non-public information about a specific security and, as a result, buys shares of that security the following day.
- 3. _ An agent sells securities to a client that are not are not sold by his firm outside his firm’s knowledge.
- 4. _ An agent makes trades in an account with another firm without notifying her employing firm.
- 5. _ An officer of a publicly-traded company tells an investment adviser that the production of a much publicized product may not occur as originally planned.
Answers
- 1. D. Intentionally entering identical and opposite trades for the same security in order to create a false sense of trading activity is a mode of
