Is there any evidence supporting this claim?
>The only people who do it are a very small overlap of the Venn diagram of people who have access to material nonpubluc information and don’t yet know it’s impossible to monetize it
Which side is it? That there are less people people who have insider information, or that it's harder to monetize insider information? Unless there's big shift in US corporate culture leading to better information controls across the board, I don't think it's the former. I can't think of anything that'd change the latter, unless HFT/hedge funds found some sort of crystal ball so they can front-run the insiders.
As a result of the individual book model dying, inside information isn't worth much. You can't trade on your own, and you can't share it with others.
Moreover, with outflows from discretionary to quantitative strategies, there's not that many hedge funds (by capital at least) that could even do anything with inside information. It's not like if some guy at Bridgewater got a hot merger tip he would even be able to do anything with it.
tl:dr: lots of things have changed, and the industry is no longer conducive to exploiting insider information.
I'm sure it still happens, but at an individual or informal kind of level. It's not an institutionalized accpeted thing like at SAC or Gallion, for example.
It appears that they changed how they were run the instant Trump was elected. Funny how that works!
The only thing you said was "because X and Y happened at the same time, they seem to be connected". You did not make any other arguments about how X could cause Y. Within the past hour, I went to the bathroom, and also at least one person on earth died. As you can see, to say my bathroom trip caused that persons death is illogical without any other facts or evidence to back it up.
This is a really funny site btw: https://www.tylervigen.com/spurious-correlations
Who committed the indsider trading?
https://www.cnbc.com/2020/07/29/kodak-executive-chairman-add...
If the Libor scandal can happen, it's not difficult to imagine a hedge fund working together for this purpose.
It’s both. There’s no reason to acquire the information if you cannot monetize it sufficiently. It becomes a liability to have it around. And the whole reason you cannot monetize it sufficiently is that the moment any event occurs, the SEC/FINRA combs through everyone whose trading patterns were suspicious. With the amount of surveillance, you’re almost guaranteed to get caught. There’s no secret meeting in a parking lot. There’s no Signal communications.
I’m not saying there is no criminality in the financial world. Just that this particular crime is so heavily watched and carries such a strong punishment that no rational investor risks it. It mostly ends up being retail guys who got a tip, but didn’t know that the tip was illegal or they just had no clue the depth that the DoJ’s tentacles can reach.
My evidence is that I’m in this world. HFs have departments that read research and then cross checks it to make sure it only includes public information. If somehow a nonpublic piece slips in, they kill the trade.