Question

Which of the following authorities are prohibited from doing 'insider trading'?

• A. Key Managerial Personnel of the Company
• B. Director of the Company
• C. General Manager of the Company
• D. All of the above

Answer 1

Answer: (D)

All of the above

Insider trading is the illegal practice of trading on the stock exchange to one's own advantage through having access to confidential information. Section 195 of the Companies Act, 2013 prohibits insider trading in a company. For that purpose, insider trading has been defined as an act of subscribing, buying, selling, dealing or agreeing to subscribe, buy, sell or deal in any securities by any director or key managerial personnel or any other officer of a company either as principal or agent if such director or key managerial personnel or any other officer of the company is reasonably expected to have access to any non-public price sensitive information in respect of securities of company