SEC employees front running the public

M

MoreLeverage

Not much has changed since 2009 when two high profile SEC lawyers were caught red handed trading against SEC policy:

http://www.cbsnews.com/news/sec-attorneys-probed-for-insider-trading/

Four years and no disciplinary actions later, not much has changed. New FOIA data shows SEC employees are still misappropriating inside information from their jobs to front run the public ahead of enforcement actions and benefit personally. Brought to you by the same guys who exposed Congressional insider trading, here's their latest paper:

http://ify.valuewalk.com/wp-content/uploads/2014/02/SEC-Stockpicking-Skills.pdf

We examine the trading strategies of SEC employees in 2009-2011, a period during which the SEC has pledged to dedicate substantial resources to restrict opportunistic trading. Our findings indicate that SEC employees still trade profitably during this period, with trading profits (about 4 % per year for all securities) similar to those earned by corporate insiders (Jeng et al., 2003). These profits are driven by trades in US common stocks (about 8.5% abnormal return per year), over which the SEC holds the most influence and private information (relative to funds and foreign securities).
More...

9% alpha would do a hedge fund manager proud. Think how good they would be if they didnt suck at trading everything else they tried - foreign stocks, bonds, ETFs and funds, etc.
 
This just can't be true. We know all regulators are selfless angels protecting us from greedy pigs on Wall St. Don't try to change my closed mind!
 
You must log in or register to reply here.
Back
Top