Abstract
Federal law has long prohibited insider trading in securities such as stocks and bonds. Yet many other financial assets—particularly derivatives and commodities—have historically fallen outside those rules.
This Article asks why insider trading is penalized for some assets but not others. It argues that the goals of insider trading law are often pursued through alternative mechanisms. Markets lacking insider trading prohibitions are not unregulated; rather, they are governed by substitute regimes that achieve similar ends through different means.
By examining the relationship between securities insider trading law and derivatives position limits, this Article clarifies the function of insider trading regulation and illuminates its boundaries. It shows that position-limit rules, though rarely analyzed in this way, can serve as functional substitutes for insider trading restrictions, offering a broader perspective on how law manages informed trading across markets.
