Insiders Banned from “Treading Water” Trading

Insiders of listed companies (members of the Board of Directors, Supervisory Board and other officials) will be banned from so-called “treading water” trading, said a draft circular on information disclosure released by the State Securities Commission of Vietnam (SSC).

 

They will not be able to register to buy and sell shares [of their companies] at the same period of time. The buying and selling of a stock in the same period of time is so-called “treading water” trading. This form of trading intensified from 2010 and distressed investors.

 

Naturally, insiders are always the first to know full and accurate business information of their company. Therefore, some may use this source of information to buy/sell or sway share prices, causing adverse impacts on individual investors.