Successful stock trading requires access to information — preferably publicly available information. However, some investors attempt to get a jump on the market by using insider knowledge to make buying, selling and holding decisions. Federal and state laws prohibit trading by anyone with material nonpublic information about a stock’s underlying company. And it’s illegal for holders of material nonpublic information to share it with others who then use the tips to trade. Insider trading policies aren’t required of public companies. However, having a policy can reduce your company’s risk and help insiders understand what actions might constitute a violation of securities law. 5 elements A good insider trading policy typically answers the following questions: 1. Why does the policy exist and whom does it cover? Your policy should define...