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    Insider trade on Splunk acquisition?

    (twitter.com)
    417 points mkmk | 15 comments | 21 Sep 23 15:58 UTC | HN request time: 1.097s | source | bottom
    1. sakex ◴[21 Sep 23 18:57 UTC] No.37602311[source]▶
    Let's say you live in front of the Splunk office, and you see tens of people in suits, a limo with a CISCO sticker, as well as a lot of commotion on the office in front of you. You strongly suspect something is happening, you buy $22k of Splunk calls.

    Is that insider trading?

    replies(7): >>37602338 #>>37603186 #>>37604277 #>>37606267 #>>37607724 #>>37608700 #>>37608735 #
    2. ar_lan ◴[21 Sep 23 18:58 UTC] No.37602338[source]▶
    Disclaimer: not financial advice

    I don't think so, it happened publicly, you weren't privvy to classified details. I would go for it if I were in that scenario.

    replies(1): >>37602538 #
    3. sakex ◴[21 Sep 23 19:09 UTC] No.37602538[source]▶
    If it's legal, it means that somebody could write a model that could predict mergers pretty accurately and make a lot of money. For instance, by tracking flight patterns of C-suites executives, scanning car brands in parkings next to offices using satellite images, and analysing working hours of the staff (this can be done in multiple ways like sending e-mails to check of automated OOO responses or analysing the light coming out of the building from satellite images.)
    replies(6): >>37602610 #>>37602651 #>>37602684 #>>37602764 #>>37602889 #>>37604878 #
    4. ar_lan ◴[21 Sep 23 19:13 UTC] No.37602610{3}[source]▶
    I think some analysts have been doing flight analysis for a long time to help inform trades.

    Everything you listed is publicly accessible knowledge (there is an interesting conversation over the fact that a poor person is unlikely to have the available means to attain this information) and I think should be fair game. But I really have not done the legal research to confidently give you a “Yes” and willfully will exit so I don’t get some SEC agent knocking on my door.

    5. JumpCrisscross ◴[21 Sep 23 19:16 UTC] No.37602651{3}[source]▶
    > by tracking flight patterns of C-suites executives, scanning car brands in parkings next to offices using satellite images

    This was old enough to be the stuff of office legends fifteen years ago. (Also, flying drones to thermally image petroleum tankers to infer their levels.)

    6. tqi ◴[21 Sep 23 19:17 UTC] No.37602684{3}[source]▶
    A version of this is already happening: https://www.theatlantic.com/magazine/archive/2019/05/stock-v...
    7. flangola7 ◴[21 Sep 23 19:22 UTC] No.37602764{3}[source]▶
    This happens already.
    8. burkaman ◴[21 Sep 23 19:29 UTC] No.37602889{3}[source]▶
    You can buy the flight data right from Nasdaq if you want to: https://data.nasdaq.com/alternative-data/corporate-aviation-...

    But if it's that easy that means other people are already doing it and you probably can't make any money.

    Plenty of companies will help you monitor parking lots too: https://orbitalinsight.com/geospatial-solutions/financial-se..., https://rsmetrics.com/asset-tracker/

    The general term for this stuff is "alternative data".

    9. user3939382 ◴[21 Sep 23 19:47 UTC] No.37603186[source]▶
    If I may comment on this issue in the abstract: don't count on technicalities to get you out of legal trouble. Those are fine if you're very wealthy and have money for the types of lawyers and appeals that can use them. For everyone else, you don't want to be so close to the line that you end up losing because the judge doesn't like your face and woke up on the wrong side of the bed.
    10. francisofascii ◴[21 Sep 23 21:01 UTC] No.37604277[source]▶
    And what if you are the caterer being sent to the Splunk office to deliver some lavish celebratory meal?
    11. mkii ◴[21 Sep 23 21:48 UTC] No.37604878{3}[source]▶
    Hypothetically, if you assume somebody else will go through all that, wouldn't it be easier to acquire market data and follow unusual trades?
    12. n2d4 ◴[22 Sep 23 00:18 UTC] No.37606267[source]▶
    I'm not a lawyer, and I'm sure there's one that would make the argument that it is. But generally, hedge funds do very similar things to predict mergers: https://www.bloomberg.com/news/articles/2019-07-02/hedge-fun...
    13. BonoboIO ◴[22 Sep 23 04:06 UTC] No.37607724[source]▶
    Would I be able to see such a trade when the trader makes them and just copy the trade with a small amount.

    Thinking is: „Who the hell would make such a trade if he doesn’t have some information, let’s do the same“

    14. sigwinch28 ◴[22 Sep 23 06:46 UTC] No.37608700[source]▶
    Based on the compliance training I did this week at a hedge fund…

    On the condition that you acted solely on information that was already public, or something that happened in a public place that you happened to witness as a bystander…

    No, that is not usually considered insider trading.

    Not a lawyer, not advice.

    15. harisec ◴[22 Sep 23 06:52 UTC] No.37608735[source]▶
    You still don't know the exact date of the potential acquisition. So you cannot make a successful trade. I would say it's not insider trading.