Insider trading ethical dilemma and study of portfolio evidence

Applied Business Ethics
Insider trading ethical dilemma and study of portfolio evidence
Student: NGUYEN TUAN DUNG

Contents TOC \o "1-3" \h \z \u Part A: Ethical Dilemma - Insider trading PAGEREF _Toc396083897 \h 2Description of insider trading and its ethical issues PAGEREF _Toc396083898 \h 21.Insider trading: Why is it an ethical dilemma? PAGEREF _Toc396083899 \h 32.Ethical solutions to this dilemma PAGEREF _Toc396083900 \h 4Part B: Portfolio of Evidence Content PAGEREF _Toc396083901 \h 7Appendix A: The Ethical Leadership Debate PAGEREF _Toc396083902 \h 7Appendix B: The Seminar case PAGEREF _Toc396083903 \h 9Appendix C: Interpersonal and team working skills PAGEREF _Toc396083904 \h 11Reference List PAGEREF _Toc396083905 \h 13

Part A: Ethical Dilemma - Insider tradingDescription of insider trading and its ethical issuesInsider trading has been emerging and existing since the born of stock market. This phenomenon is defined as the trading of securities, either stocks or bonds or other instruments based on the unfair access of different individuals to information, in other words, information asymmetry CITATION DWC83 \l 1033 (Carlton & Fischel, 1983). However, the debates over ethics and legal issues over insider trading have still been contentious. Some empirical studies have reflected positive impacts of insider trading on the market efficiency like CITATION RWM97 \t \l 1033 (McGee & Block, 1997)emphasized on the roles of insider trading in making prices more realistic, encouraging hostile takeovers. Nevertheless, to some investors, especially those who burden from the consequences of 2008 global financial crisis, insider trading has become dark area. Financial industry, similar to other businesses, is money-oriented; however, a few people make profit in the expense of many other participants, community, society is unfair and unethical CITATION MGV02 \l 1033 (Velasquez & Velazquez, 2002). Moreover, insider trading also presents unethical

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