Regulation and insider trading in the US stock market

The aim of this paper is exploring use of insider trading in the capital markets, producing information asymmetry and adverse selection for those who do not have access or otherwise delayed access to data. Here we can see the key regulations of the US market -Securities Act of 1933 and Securities Exchange Act of 1934, or Securities Act as it is commonly known, which has two main objectives: the foundation of SEC (Security and Exchange Commission), the main federal agency responsible enforcing the law of US financial markets and also the regulation of secondary markets. Finally, the Investment Company Act of 1940 to control US financial markets. These issues are addressed and other cases showing the economic impact by that market imperfection.