What are the implications of insider trading regulations on demat account holders? MintGenie explains

livemint.com:

Insider trading, the act of trading securities based on non-public information, has been a major concern for regulators around the world. It not only undermines market integrity but also raises questions about fairness and equality in the marketplace. To address this issue, various measures have been taken by regulators, including the introduction of the dematerialized (Demat) account system.

While the concept of insider trading is often associated with corporate insiders such as executives and directors, it can also involve individuals who have access to confidential information through their roles in various capacities within a company.

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In the digital age of investing, where transactions are often executed through demat accounts, the potential for insider trading takes on new dimensions. In this article, we will delve into the implications of insider trading for investors.

A demat account is a digital platform that enables investors to hold their securities electronically, eliminating the need for physical certificates. This system offers numerous advantages, including secure storage, seamless transferability, and swift transaction settlements.

Moreover, beyond its conventional benefits, the demat account infrastructure serves as a mechanism for curbing insider trading practices.

Also Read: Demat Account: What is the significance of holding period?

Insider trading refers to the buying or selling of a publicly traded company's stock by someone who has non-public, material information about that stock. This information could include details about the company's financial performance, pending mergers or acquisitions, regulatory approvals, or other significant