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Asymmetric information |
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Asymmetric informationThe failure of two parties to a transaction to have the same relevant information. Examples are buyers who know less about product quality than sellers, and lenders who know less about likely default than borrowers. Both are common in international markets.Asymmetric informationInformation that is known to some people but not to other people.Asymmetric information Similar MatchesInsider informationInsider informationPrice-sensitive information about a company that has not yet been made public.People who use the information either to make a profit for themselves or for someone else are committing a criminal offence (insider dealing).The inside dealer does not have to work for the company for his dealing to be an offence. So a stockbroker, or merchant banker, who knows about an impending takeover deal who buys shares in the target company with the intention of making a profit, is guilty. If he gets a friend to buy the shares, he is still guilty. In theory, the net is cast quite wide. In practice, insider dealing prosecutions are rare, and successful ones rarer still because the allegations are so hard to prove.Note the difference between insider dealing (an offence) and directors dealings (not an offence). For your information (FYI)For your information (FYI)A prefix to a security price indicating that the quote is for information purposes only, and not an offer to trade. Information asymmetryInformation asymmetryCondition that information is known to some, but not all, participants. Intermarket Surveillance Information System (ISIS)Intermarket Surveillance Information System (ISIS)A database that distributes information from all the major stock exchanges in the United States. Information content effectInformation content effectThe rise in the stock price following a dividend signal, or publication of some other related news. Further SuggestionsInformation RatioInformation Agent Information costs Informational efficiency London Market Information Link Insider information Limit order information system Information Coefficient (IC) Information services Complete information Technical Information Informational efficiency Incomplete information Expected value of perfect information Nonpublic information Information architecture Fundamental Information Statement of Additional Information (SAI) price sensitive information |
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