If I go to a bar, and overhear a pair of Googlers discussing something secret and overhear it, I can:
1) Trade on it.
2) Talk about it.
Because I'm not an insider. On the other hand, if I'm sleeping with the CEO, I become an insider.
Not a lawyer. Above is not legal advice. Just a comment that the line is much more complex, and talking about a potential acquisition is usually okay (if you're not under NDA).
Just so you know, plenty of people have been penalized for practicing law without a license. If someone engages in insider trading based on a mistake you made on the internet, you can be liable.
In my jurisdiction, that would involve me taking money (not just talking on the internet), so I'm not at risk, but in plenty of states, you can be. A lot of this hinges on the difference between "legal information" (which is generic) and "legal advice" (which is specific).
There are whole law review articles on this, which I read more than a decade ago, nerding on something related.
But that's beside the point. A major reason for the disclaimer is that people SHOULD be aware of my level of expertise. I do the same on technical posts too. I'll disclaim whether e.g. I have world-class expertise in a topic, worked in an adjacent domain, or read a blog post somewhere (and wish others did too). It's helpful to know people's backgrounds. I am NOT a lawyer specializing in securities law. I know enough to tell people the line is more complex than trading on non-public information, but I am utterly unqualified to tell people where that line is. If you're planning to do that, you SHOULD NOT rely on it. Either read relevant case law, talk to a genuine lawyer who specializes in this stuff, or find some other way to educate yourself on whether what you're doing is okay.
So it does matter I'm not a lawyer, if not for the reasons you mentioned.
It doesn't matter if you overheard it at a bar or if you're just some HN commenter posting completely incorrect legal advice; the law prohibits trading on material nonpublic information.
I would pay a lot to see you try your ridiculous legal hokey-pokey on how to define an "insider."
No, a bar is a public place so this counts as a public disclosure. The people having the conversation would be in trouble with the SEC for making a disclosure in this manner.
No. It's not. However, as pointed out elsewhere, you can trade on many types of non-public information. Indeed, hedge funds engage in all sorts of surveillance in order to get non-public material information to trade on which gives them a proprietary edge.
Unless you earn enough money to retain good lawyers and are prepared to get into complicated legal troubles, getting sued isn't a great outcome even if you win.
The prudent thing to do is to stay away from anything that might make you become a target of investigation, unless the gains outweigh the risk by a significant margin.
Had insider trading training, and yes, that's the gist of it. If you know or presume that the information is material (makes a difference) and not public, it's illegal to act on it.
Roughly, it's illegal only if you have some duty not to trade on it. If you acquired the information without misappropriating it (like overhearing it from strangers in a normal public bar), then you're free to trade.
There's no reason for normal corporate training to discuss that element, because an employee who trades their employer's stock based on MNPI has near-certainly misappropriated it. The question of whether a non-employee has misappropriated information is much more complex, though.
Training is designed to protect the corporation, not to provide accurate lega ladvice. That's true of most corporate trainings, for that matter, be that bribes / corruption, harassment, discrimination, or whatnot. Corporations want employees very far from the line.
That's the right way to run them.
If you want more nuance, talk to a lawyer or read case law.
Generally, insider trading requires something along the lines of a fiduciary duty to keep the information secret, albeit a very weak one. I'm not going to slice that line, but you see references in-thread.
