I think if what we were seeing was genuine insider trading, it would likely look a lot more like “buys shares at $0.01 way in advance for oddly specific date”, sells when market resolves.
I feel like you’re arguing against a pretty narrow definition of insider trading, where the trader must have near-perfect information about the future at a time when everyone else has ~0 information. But,
Why should they be able to buy shares at $0.01? Maybe they only received the information at a time when the price was $0.10.
Why would they necessarily know the exact date well in advance? And even if they did, would they be able to bet on an ‘oddly specific date’ for any significant sum? If there’s no existing liquid market for that specific date, they may not be able to create one; and if they care at all about not looking incredibly suspicious after the fact, then they shouldn’t do that even if they could.
I think this applies to most of your post, not just the sentence I quoted. For example, you talk about the irrationality of selling before resolution, but I don’t see why the hypothetical insider would necessarily know those outcomes with certainty in advance. So why not take the profit early rather than risking it?
My impression is that you’re largely arguing against the ‘literally Trump, or someone in direct and ongoing collaboration with Trump’ hypothesis. But there’s so much more room for it to be someone who had a big piece of inside info, but wasn’t in control of any high-level decisions and couldn’t see the future with certainty.
I feel like you’re arguing against a pretty narrow definition of insider trading, where the trader must have near-perfect information about the future at a time when everyone else has ~0 information. But,
Why should they be able to buy shares at $0.01? Maybe they only received the information at a time when the price was $0.10.
Why would they necessarily know the exact date well in advance? And even if they did, would they be able to bet on an ‘oddly specific date’ for any significant sum? If there’s no existing liquid market for that specific date, they may not be able to create one; and if they care at all about not looking incredibly suspicious after the fact, then they shouldn’t do that even if they could.
I think this applies to most of your post, not just the sentence I quoted. For example, you talk about the irrationality of selling before resolution, but I don’t see why the hypothetical insider would necessarily know those outcomes with certainty in advance. So why not take the profit early rather than risking it?
My impression is that you’re largely arguing against the ‘literally Trump, or someone in direct and ongoing collaboration with Trump’ hypothesis. But there’s so much more room for it to be someone who had a big piece of inside info, but wasn’t in control of any high-level decisions and couldn’t see the future with certainty.