The process by which ‘insiders’ can trade in Australia is currently flawed. The current system in Australia only allows insiders to trade within specified windows. This has significant and detrimental signalling effects and wider repercussions for the public markets. We firmly believe that the Australian market would benefit from the adoption of a similar system to that which is utilised in US markets. Allowing insiders to establish a written trading plan that articulates when they will buy and sell shares at a predetermined time, on a scheduled, automatic basis would alleviate this tension not only for insiders, but also other shareholders.
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