A Study On Insider Trading With Special Reference To Indian Market
- NLR Journal
- Apr 22
- 1 min read
By Dr. Punam Kumari Bhagat, Associate Professor, DBS Global University, Dehradun.
Abstract
Insider trading means dealing in the share and securities of a company by the insiders who has secret and confidential information which is not known to the public in order to make personal profits or to avoid losses. Such an activities are very rampant nowadays in a developing country like India due to lack of stringent laws in this regard. Insider is a person who has access to or has otherwise received any unpublished price sensitive information by virtue of his dominant position in a company.
This kind of activities on the part of insiders are the breach of their fiduciary duty towards the company. Insider trading is morally and legally not acceptable because it will adversely affect the economy of the country. It will lose the trust of the general public and will also be detrimental to the integrity and sanctity of stock market. Insider trading is in fact an economic offence which need to be checked on a serious note because it has tendency of hampering the healthy growth of stock market and will also slow down the capital flow and foreign investment.
This research paper will review the insider trading provisions in India and compare the Indian laws with the laws of the other developed countries in this respect. The study will also try to find out possible solutions in order to diminish this kind of practices in India. Doctrinal method will be adopted to achieve the goal.
Keywords: Insider Trading, Indian Market, Regulation, Prohibition.
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