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Regulation FD
When Regulation FD went into effect, it effectively ended the confidential relationship management of public companies had with select institutions and individuals. Previously, company management could meet with analysts/institutional heavy weights and confidentially provide them with detailed financial information about their company, increasing the accuracy of the research. However, Regulation FD decided this practice was insider trading, because the analyst acted on insider information when issuing reports. Since Regulation FD, research analysts cannot receive any information from company management that management does not also make public, ending the days of confidential meetings between analysts and company management. Regulation Full Disclosure and Analyst Research Coverage When Regulation FD went into effect in October 2000, it effectively ended the confidential relationship analyst had with management of companies they covered. Previously, company management could meet with analysts and confidentially provide them with detailed financial information about their company, increasing the accuracy of the analyst research. However, Regulation FD decided this practice was insider trading, because the analyst acted on insider information when issuing reports. Since Regulation FD, research analysts cannot receive any information from company management that management does not also make public, ending the days of confidential meetings between analysts and company management. Purpose of Regulation FD The SEC believes that selective disclosure leads to a loss of investor confidence in the integrity of our financial markets. Regulation FD seeks to ensure full and fair disclosure of all material nonpublic information so no one and no organization can unfairly profit from insider’s selective disclosures. For analysts, this means that a company cannot give an analyst any information not also made available for public use. Restrictions Under Regulation FD Complete details of Regulation FD are... [continued...] Want to know more? Download the White Paper "Regulation FD" for just $9.95. People who ordered this paper also ordered: |
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