If I make big profits in my P/A does the SEC automatically investigate me?
If I have say a $500,000 P/A and invest all of it into one stock, say AMZN, and a few weeks/months later it goes up by a lot, say doubles or even more, and I make a ton of profit - does the SEC automatically investigate this? Even if I do not have any insider information and simply concentrated all my eggs in one basket that turned out to be a great trade?
I like to make extremely concentrated investments, but will this raise eyebrows at the SEC if the bet turns out to be a winner?
Would suck big time if the SEC went after something like this - would make the rules appear very rigged - if you make money, you are investigated. But what if I lose all $500K on a stupid trade? how come they don't investigate me then? Sadly, it's all about the money these days...
Would appreciate any clarification
Okay. Let's talk hypothetically here - If by some chance you have a P/A with concentrated positions and you are not in banking and, as you've said, you've held those positions for a period of time, it's a maybe/maybe not position. It depends on timing, among other things, that could spark an inquiry. However, seeing as your an Analyst and have to abide by the Restricted List, and your company is aware of all the trade activity in your account... and you haven't violated any restrictions under their rules and regs, then I doubt it would be an issue. You did make sure your company received a copy of all of the trades that happen in your P/A and aren't trading away from your firm, right? Because that's illegal and could get you busted for insider trading.
Frieds - thanks for ur response. For the analyst thing, I just had to fill something in on this forum - but no I do not work for investment bank. My question was if I was just a regular Joe with my own P/A, and if I invested in a good stock that 2x or 3x over say a few months, I made some money, but it was a very concentrated position - will the SEC necessarily investigate b/c of this alone? I'm talking about a normal long stock position, not a fancy concentrated bet using options or whatnot.
If you're not doing anything wrong, why would you be concerned with an SEC investigation in the first place? If it's a clean trade, there's nothing to worry about, they'll find nothing and you'll go about your life as if it never happened.
Consequatur iure voluptate qui corrupti excepturi. Nam at enim et ipsum id voluptatibus. Blanditiis voluptas a omnis maiores deserunt necessitatibus blanditiis. Ab neque fugit quia dignissimos placeat.
Architecto architecto corporis aut doloremque vel dolorem. Magni quis facere placeat neque incidunt et velit. Omnis consequatur aliquid voluptate impedit.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...