Analysis of insider trading regulations in India

Abstract

The goal of this study is to look at insider trading in the Share market and see how profitable it is as well as how much data it contains. It also intends to look at the link between insider trading and market collapse. Insider trading is ethically and legally unacceptable to the uninformed population to utilize classified information for stock and security trading in order to gain or prevent loss. It is the most frequent form of abuse in the stock exchanges and also the most threatening because it leads to asymmetric information to the disadvantage of small entrepreneurs. It's always been a point of concern and scandal, with headlines and a destructive image of the not only enterprises but the economies. This has been an area which affects equitable chances for investing in financial market. It lies at the heart of prejudice, as a small minority, which is usually quite privileged, has an unfair advantage over the large population whose knowledge or chance is not equivalent. The elimination of this exercise is essential for the efficient working and credibility of any market and of the communities in which it operates since it does not only harm the credibility of the market as well as the trust which is based on it and eventually the economic growth of the country in general, at home and abroad. Therefore, it is important, for law policymakers’ shareholders, and the public to regulate the insider trading on the stock market. India, one of Asia's quickest developing economies, needs comprehensive insider trade controls on financial markets to give domestic & global investors fair and equitable footing if they are to rank among the world's most developed economies. This thesis focuses mostly on regulating the insider trade in India and has therefore been attempted to study it in a variety of ways.