Question Bank - Accountancy

Here's the question bank on all the accountancy topics.

To whom is the term "insider trading" related?

A.
Hawala
B.
Public
C.
Share Market
D.
Tax

Solution:

The correct answer is Share Market. The term insider trading is associated with the share market. Insider trading is the buying or selling of a publicly-traded company's stock by someone who has non-public, material information about that stock. Material non-public information is any information that could substantially impact an investor's decision to buy or sell the stocks that have not been made available to the public. Insider trading is illegal and comes with stern penalties including both potential fines and jail time. Securities and Exchange Board of India (SEBI) have stringent rules to prevent insider trading. Additional InformationHawala: Hawala is the underground, cheap and instant medium to transfer the huge amount of money. Hawala is cheaper and less cumbersome than formal remittance channels such as banks, Western Union or Money Gram. Hawala system is used by Criminals, Businessmen, and Nonresidents to remit money. Halawa system is the backbone of the underworld, drugs/arms mafias, terrorists and smugglers. Businessmen use it transfer money to evade tax.

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