A practice that was made illegal in the United States in 1934 and in the UK in 1980, and is now banned (for shares, at least) in most countries. Insider trading involves using information that is not in the public domain but that will move the price of a share, bond or currency when it is made public. An insider trade takes place when someone with privileged, confidential access to that information trades to take advantage of the fact that prices will move when the news gets out. This is frowned on because investors may lose confidence in financial markets if they see insiders taking advantage of advantageous asymmetric information to enrich themselves at the expense of outsiders. But some economists reckon that insider trading leads to more efficient markets: by transmitting the inside information to the market, it makes the price of, say, a company’s shares more accurate. This may be true, but most financial regulators are willing to sacrifice a degree of accuracy in pricing to ensure that outsiders (the great majority of investors) feel they are being treated fairly.