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US law dictates that you cannot buy / sell shares in a company you work for except during open trading windows. I understand lockout periods when you're in a company but what about after you quit?

If I were to no longer work for a company can I buy it's stock without any insider trading issues (assuming I had no insider info)? Is there a given period of time that I need to wait? I'm asking for a general US based insider trading law.

Here is an example: what if I work for CocaCola and then quit. Can I buy coke shares the next day? (substitute any other company for Coke)

Please give a reference to the rules you find. I couldn't find any specific to once you leave a company only to things like stock options etc.

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I don't think Coca Cola company rules are publicly available. – littleadv Jan 19 at 23:35
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@littleadv It was an example, I'm pretty sure the rules of what is considered insider trading of stocks should apply to all publicly traded companies – Tai Jan 19 at 23:37
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There's no blanket rule forbidding employees to purchase stocks of companies they work at. – littleadv Jan 19 at 23:40
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If while working at Coca Cola, you have insider info that a new product would be a game changer and Coca Cola would make huge profits, this new product is being made public info after 15 days after you have quit. So you still can't buy and can be prosecuted if it can be evidenced that your buying shares even after you quite was because you had this insider info. – Dheer Jan 20 at 2:54
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You can buy shares in any company, even one you work/have worked for. What you can't do is take personal advantage of the inside information you have access to. – Zenadix Jan 20 at 16:33
up vote 44 down vote accepted

US law dictates that you cannot buy / sell shares in a company you work for except during open trading windows. I understand lockout periods when you're in a company but what about after you quit?

There's no such law.

Trading lockouts are imposed by companies themselves to avoid the complexities of identifying "insiders". For large companies it sometimes is easier/cheaper to assume everyone is insider instead of imposing internal data flow controls and limitations.

For such companies, their internal policies would also manage how the employees who are leaving should be treated.

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Insider trading is when you buy or sell an investment based on material, non-public information that gives you an unfair advantage over the rest of traders in that market.

Working for a company is one way that you might have such information, but whether it is insider trading is not contingent on you working there. You could use that information a long time after leaving the company. You don't even need to have worked there. If a friend/relative gave you non-public information because THEY work there, it is still insider trading.

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Likewise if you learned about some big secret project/issue while you were there that was still unannounced when you bought/sold the shares, even if that was after you quit. – jcaron Jan 20 at 9:12
    
That is a really poor explanation of insider trading. Insider trading is about two parts. Information not available to most people in the company or public and most importantly the timing of the buying and selling. If a friend gave you a tip about their company and you bought 500 shares it may or may not be insider trading in the broadest sense but no one would get prosecuted for this. – blankip Jan 21 at 14:56

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