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Finance Dictionary and Glossary of Investment Terms
Selling of a company's stock by individual directors, executives or other employees. While selling of small amounts of stock is quite common and should not necessarily be a cause for alarm, selling of large amounts of stock is sometimes interpreted by investors as a sign that the insiders know something negative about the company's future. Insider selling which is based on insider information is illegal. The SEC has set up a rule by which insiders may sell specific amounts of their holdings at specific times, and this information is recorded for public scrutiny in the annual report. opposite of insider buying.