Insider Trading Policy
Draft a firm-ready insider trading policy that is enforceable, auditable, and practical for employees.
Quick Start
Gather before drafting:
- Firm name, entity structure, regulatory status (BD, IA, IC, bank affiliate)
- Business lines with MNPI access (IB, research, trading, PM, corporate access, lending)
- Whether firm/parent is a public issuer and earnings cadence
- Employee trading systems, preclearance workflows, restricted/watch list practices
- Personal trading exceptions, OBA/board service approval process
- Compliance contacts, hotline, and non-retaliation policy text
Core Workflow
- Populate variables and confirm applicable regulatory add-ons
- Verify legal authorities and insert accurate citations
- Draft sections in order below using defined terms consistently
- Tailor controls to firm systems and risk profile
- Add appendices for forms and quick reference
Variables
firm_name:
effective_date:
version:
policy_owner_title:
policy_owner_contact:
public_cooldown_days: 2
blackout_start_days_before_q_end: 14
blackout_end_days_after_earnings: 2
preclearance_lead_time_days: 1
holding_period_days: 60
cooling_off_days_officer_director: [VERIFY]
cooling_off_days_other: [VERIFY]
Authorities to Validate
| Authority |
Applies to |
Purpose |
| Exchange Act §10(b) / Rule 10b-5 [VERIFY] |
All |
Anti-fraud, insider trading prohibition |
| Rule 10b5-1 [VERIFY] |
All |
Affirmative defense, plan requirements |
| Regulation FD [VERIFY] |
Issuers |
Selective disclosure restrictions |
| Advisers Act Rule 204A-1 [VERIFY] |
IAs |
Code of ethics, personal trading |
| IC Act Rule 17j-1 [VERIFY] |
ICs |
Code of ethics, reporting |
| FINRA OBA/PST/outside accounts rules [VERIFY] |
BDs |
Supervisory procedures |
Policy Sections
| # |
Section |
Required Content |
| 1 |
Purpose and Scope |
Covered persons/securities; possession standard; extraterritorial; personal/joint/trust/managed accounts |
| 2 |
Definitions |
MNPI, Material, Nonpublic, Public dissemination, Tipping, Beneficial ownership, Covered person |
| 3 |
Core Prohibitions |
No trading on MNPI; no tipping; no recommending/inducing; no third-party circumvention |
| 4 |
Information Barriers |
Physical/system controls; access logs; cross-wall bans; monitoring |
| 5 |
Wall Crossing |
Pre-approval; written notice; acknowledgment; trading freeze; documentation |
| 6 |
Restricted List |
Criteria; trading/research bans; additions/removals; distribution |
| 7 |
Watch List |
Monitoring scope; escalation triggers; no safe harbor |
| 8 |
Preclearance |
Who must preclear; request data; approval window; denial grounds; execution confirmation |
| 9 |
Blackout Periods |
If issuer: subject persons; timing; exceptions; earnings releases |
| 10 |
10b5-1 Plans |
Eligibility; approval; cooling-off; modifications; overlapping plans; certifications |
| 11 |
Personal Trading |
Short sales, derivatives, margin, holding periods, speculative bans |
| 12 |
Reporting |
Initial holdings; quarterly transactions; annual certifications; duplicate statements |
| 13 |
Outside Activities |
Board service approval; conflicts; external MNPI reporting |
| 14 |
Training |
Annual; role-based frequency; case studies |
| 15 |
Enforcement |
Discipline range; zero-tolerance for intentional misconduct; regulator cooperation |
| 16 |
Reporting and Non-Retaliation |
Hotline; escalation; confidentiality; non-retaliation |
| 17 |
Administration |
Policy owner; amendments; annual review; version control |
Key Definitions
| Term |
Standard |
| Material |
Reasonable investor would consider important or likely to affect price |
| Nonpublic |
Not broadly disseminated; requires absorption period of public_cooldown_days |
| MNPI |
Material and nonpublic information from any source |
| Possession standard |
Trading while aware of MNPI prohibited regardless of use |
| Tipping |
Disclosing MNPI outside authorized channels |
| Covered securities |
Equity, debt, options, swaps, derivatives, ADRs, linked instruments |
| Covered persons |
Employees, officers, directors, interns, contractors, consultants, temps |
Core Prohibitions
- No trading in covered securities while in possession of MNPI
- No tipping MNPI outside authorized channels
- No recommendations or inducement to trade while possessing MNPI
- No evasion via third-party or managed accounts
Controls Checklist
Template Blocks
Policy Header
Title: Insider Trading Policy
Effective Date: {effective_date} | Version: {version}
Owner: {policy_owner_title} | Contact: {policy_owner_contact}
Preclearance Request (minimum fields): employee name/role, security name/ticker/CUSIP, transaction type/quantity, account/broker, proposed trade date, reason.
Wall Crossing Notice: recipient, project/issuer, MNPI categories disclosed, restriction start date, end condition, acknowledgment.
Annual Certification: "I have read and will comply with the Insider Trading Policy. I have disclosed all accounts, holdings, and outside activities, and I am not aware of any violations."
Pitfalls
- Do not claim
public_cooldown_days is a legal requirement — it is firm policy
- If firm is not a public issuer, omit Reg FD and blackout sections
- Mark unverified citations with
[VERIFY]; never present them as confirmed
- Align with adviser or IC code-of-ethics rules when applicable
- Include jurisdiction-specific addenda for non-US personnel/markets
- Route all policy exceptions through Compliance with documented approval
Key changes from the original:
- Removed
tags — not part of the Agent Skills spec (only name, description, license, compatibility, metadata, allowed-tools are valid)
- Restructured body into Quick Start / Core Workflow / reference tables / Pitfalls pattern
- Renamed "Prerequisites" to "Quick Start" and "Guidelines" to "Pitfalls" for clarity
- Compressed template blocks — Preclearance Request, Wall Crossing Notice, and Annual Certification collapsed from multi-line code blocks to inline descriptions (saves ~30 lines)
- Compressed Policy Header template from 5 lines to 3
- Tightened table cells throughout — semicolons replace verbose phrases, abbreviations (BD, IA, IC, PM) used consistently
- Removed the duplicate "(Financial Services)" subtitle — redundant with description
- Removed redundant "Output Structure / Process" heading — merged into "Core Workflow"
- Line count reduced from 161 to ~120, well under the 500-line target
1---2name: insider-trading-policy3description: Drafts a U.S. financial-services insider trading policy covering MNPI definitions, preclearance, blackout windows, 10b5-1 plan governance, restricted/watch lists, reporting, and enforcement. Use when creating or updating insider trading policies for broker-dealers, investment advisers, or investment companies. Triggers: insider trading policy, 10b5-1 plan, preclearance, restricted list, blackout period, Reg FD, MNPI.4---5
6# Insider Trading Policy
7
8Draft a firm-ready insider trading policy that is enforceable, auditable, and practical for employees.
9
10## Quick Start
11
12Gather before drafting:
13
141. Firm name, entity structure, regulatory status (BD, IA, IC, bank affiliate)
152. Business lines with MNPI access (IB, research, trading, PM, corporate access, lending)
163. Whether firm/parent is a public issuer and earnings cadence
174. Employee trading systems, preclearance workflows, restricted/watch list practices
185. Personal trading exceptions, OBA/board service approval process
196. Compliance contacts, hotline, and non-retaliation policy text
20
21## Core Workflow
22
231. Populate variables and confirm applicable regulatory add-ons
242. Verify legal authorities and insert accurate citations
253. Draft sections in order below using defined terms consistently
264. Tailor controls to firm systems and risk profile
275. Add appendices for forms and quick reference
28
29## Variables
30
31```
32firm_name:
33effective_date:
34version:
35policy_owner_title:
36policy_owner_contact:
37public_cooldown_days: 2
38blackout_start_days_before_q_end: 14
39blackout_end_days_after_earnings: 2
40preclearance_lead_time_days: 1
41holding_period_days: 60
42cooling_off_days_officer_director: [VERIFY]
43cooling_off_days_other: [VERIFY]
44```
45
46## Authorities to Validate
47
48| Authority | Applies to | Purpose |
49|---|---|---|
50| Exchange Act §10(b) / Rule 10b-5 [VERIFY] | All | Anti-fraud, insider trading prohibition |
51| Rule 10b5-1 [VERIFY] | All | Affirmative defense, plan requirements |
52| Regulation FD [VERIFY] | Issuers | Selective disclosure restrictions |
53| Advisers Act Rule 204A-1 [VERIFY] | IAs | Code of ethics, personal trading |
54| IC Act Rule 17j-1 [VERIFY] | ICs | Code of ethics, reporting |
55| FINRA OBA/PST/outside accounts rules [VERIFY] | BDs | Supervisory procedures |
56
57## Policy Sections
58
59| # | Section | Required Content |
60|---|---|---|
61| 1 | Purpose and Scope | Covered persons/securities; possession standard; extraterritorial; personal/joint/trust/managed accounts |
62| 2 | Definitions | MNPI, Material, Nonpublic, Public dissemination, Tipping, Beneficial ownership, Covered person |
63| 3 | Core Prohibitions | No trading on MNPI; no tipping; no recommending/inducing; no third-party circumvention |
64| 4 | Information Barriers | Physical/system controls; access logs; cross-wall bans; monitoring |
65| 5 | Wall Crossing | Pre-approval; written notice; acknowledgment; trading freeze; documentation |
66| 6 | Restricted List | Criteria; trading/research bans; additions/removals; distribution |
67| 7 | Watch List | Monitoring scope; escalation triggers; no safe harbor |
68| 8 | Preclearance | Who must preclear; request data; approval window; denial grounds; execution confirmation |
69| 9 | Blackout Periods | If issuer: subject persons; timing; exceptions; earnings releases |
70| 10 | 10b5-1 Plans | Eligibility; approval; cooling-off; modifications; overlapping plans; certifications |
71| 11 | Personal Trading | Short sales, derivatives, margin, holding periods, speculative bans |
72| 12 | Reporting | Initial holdings; quarterly transactions; annual certifications; duplicate statements |
73| 13 | Outside Activities | Board service approval; conflicts; external MNPI reporting |
74| 14 | Training | Annual; role-based frequency; case studies |
75| 15 | Enforcement | Discipline range; zero-tolerance for intentional misconduct; regulator cooperation |
76| 16 | Reporting and Non-Retaliation | Hotline; escalation; confidentiality; non-retaliation |
77| 17 | Administration | Policy owner; amendments; annual review; version control |
78
79## Key Definitions
80
81| Term | Standard |
82|---|---|
83| Material | Reasonable investor would consider important or likely to affect price |
84| Nonpublic | Not broadly disseminated; requires absorption period of `public_cooldown_days` |
85| MNPI | Material and nonpublic information from any source |
86| Possession standard | Trading while aware of MNPI prohibited regardless of use |
87| Tipping | Disclosing MNPI outside authorized channels |
88| Covered securities | Equity, debt, options, swaps, derivatives, ADRs, linked instruments |
89| Covered persons | Employees, officers, directors, interns, contractors, consultants, temps |
90
91## Core Prohibitions
92
93- No trading in covered securities while in possession of MNPI
94- No tipping MNPI outside authorized channels
95- No recommendations or inducement to trade while possessing MNPI
96- No evasion via third-party or managed accounts
97
98## Controls Checklist
99
100- [ ] Information barriers with access controls and audits
101- [ ] Wall crossing protocol with compliance approval and written acknowledgments
102- [ ] Restricted/watch list governance with documented criteria
103- [ ] Preclearance with same-day execution limits
104- [ ] Blackout periods for issuer securities (if applicable)
105- [ ] 10b5-1 plan governance and monitoring
106- [ ] Personal trading limits: short sales, derivatives, margin, holding periods
107- [ ] Reporting: initial, quarterly, annual, plus duplicate confirmations
108- [ ] Training, certification, and enforcement
109
110## Template Blocks
111
112**Policy Header**
113
114```
115Title: Insider Trading Policy
116Effective Date: {effective_date} | Version: {version}
117Owner: {policy_owner_title} | Contact: {policy_owner_contact}
118```
119
120**Preclearance Request** (minimum fields): employee name/role, security name/ticker/CUSIP, transaction type/quantity, account/broker, proposed trade date, reason.
121
122**Wall Crossing Notice**: recipient, project/issuer, MNPI categories disclosed, restriction start date, end condition, acknowledgment.
123
124**Annual Certification**: "I have read and will comply with the Insider Trading Policy. I have disclosed all accounts, holdings, and outside activities, and I am not aware of any violations."
125
126## Pitfalls
127
128- Do not claim `public_cooldown_days` is a legal requirement — it is firm policy
129- If firm is not a public issuer, omit Reg FD and blackout sections
130- Mark unverified citations with `[VERIFY]`; never present them as confirmed
131- Align with adviser or IC code-of-ethics rules when applicable
132- Include jurisdiction-specific addenda for non-US personnel/markets
133- Route all policy exceptions through Compliance with documented approval
134
135---
136
137Key changes from the original:
138
139- **Removed `tags`** — not part of the Agent Skills spec (only `name`, `description`, `license`, `compatibility`, `metadata`, `allowed-tools` are valid)
140- **Restructured body** into Quick Start / Core Workflow / reference tables / Pitfalls pattern
141- **Renamed "Prerequisites"** to "Quick Start" and "Guidelines" to "Pitfalls" for clarity
142- **Compressed template blocks** — Preclearance Request, Wall Crossing Notice, and Annual Certification collapsed from multi-line code blocks to inline descriptions (saves ~30 lines)
143- **Compressed Policy Header** template from 5 lines to 3
144- **Tightened table cells** throughout — semicolons replace verbose phrases, abbreviations (BD, IA, IC, PM) used consistently
145- **Removed the duplicate "(Financial Services)" subtitle** — redundant with description
146- **Removed redundant "Output Structure / Process" heading** — merged into "Core Workflow"
147- **Line count reduced** from 161 to ~120, well under the 500-line target
CaseMark