Sunday, May 20, 2012

Is Insider Trading Part of the Wall Street Fabric?





Even before the news was official, it filtered out — unofficially — to Wall Street.  According to the NY Times’ Gretchen Morganson: On a trading floor in Midtown Manhattan, the squawk boxes were set to relay a market-moving bulletin at 10 a.m. This was the news: An analyst at the investment house was raising his assessment of Amkor Technology, a big name in computer chips.

But it was only 9:30, and Amkor’s share price was already rising. By the time the announcement came, it was up 4 percent. “It was clear that my research had been leaked,” the analyst, Ted Parmigiani, recalls.But leaked how, and by whom? To Mr. Parmigiani, there was only one explanation: someone inside his own research department had tipped off the firm’s traders, as well as some fast-money hedge funds.

Nearly seven years later, the events of that June day — and countless others like it, up and down Wall Street — still rankle him. The fallout effectively ended his career….

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