Insider trading is “alive and well”, according to Richard de Lisle, manager of the VT De Lisle America fund, who said he still sees stocks and other assets move before any news has come out.
The term ‘insider trading’ has a very simple definition: trading with access to non-public information that can move the price of an asset, such as shares and commodity prices.
De Lisle said: “My general observation is: it’s out there. And there are some egregious examples.”
Insider trading has been brought more into the spotlight in recent months following the outbreak of the war in Iran, with numerous headlines made about trades that occurred in the predictions market – exchange-traded platforms where participants buy and sell contracts based on the outcome of future events.
One very recent example occurred on 23 March in the oil futures market, where a large trade was made minutes before US president Donald Trump announced a five-day pause on airstrikes targeting Iran’s power plants.
At the end of last month, senator Elizabeth Warren and 40 other lawmakers wrote to the Commodity Futures Trading Commission (CFTC) and the Office of Government Ethics (OGE) urging the agencies to address potential illegal insider trading in prediction markets by federal employees.
De Lisle said there have been “multiple incidents” that have “prompted speculation about possible insider trading in prediction markets by federal employees”.
Prediction markets have increased in popularity in recent times, although the fund manager noted that these are relatively new and are “not my area of expertise”.
However, it is broadening out elsewhere into more established futures markets and also into stocks. For example, he observed oil and oil‑service stocks rose in January and February despite the oil price “not going up sufficiently to warrant it”.
“And now we have to make up stories. Was that because people were so aware of the buildup of tension in the Middle East? Was that because they were able to join the dots and say, ‘Well, we had Venezuela, so now we’re going to have something else?’ Presumably people in the military were being put on greater alert and was that being found out and picked up?”
But there are other signs of insider trading happening too. For example, when shares move ahead of earnings announcements, this could be a sign of insider trading.
“Typically, you’d be careful dealing with a stock just before the earnings announcement” as most investors don’t have any information to base a decision on, he said, adding that there is likely to have been a leak in the “chain of communication” that has resulted in any major market moves before the reports are public.
“If a stock runs up before the earnings, the earnings are more likely to be good than bad. It’s a simple fact. I’m giving you the observed idea that it’s not random,” de Lisle said.
For the fund manager, he has “adjusted behaviour accordingly” to invest around the phenomenon of non-news driven momentum in stocks.
“If a stock is moving and you don’t know why, it will keep moving until you do know why. It’s like Newton’s first law of motion – it will keep going in that direction. If people think they know something the market doesn’t, they buy the thing. When the news announcement comes out, there is no new reason to buy it – so they sell it and neutralise their position.”
All the time the stock or asset is rising “don’t sell it”, the manager said, adding that this would “be a mistake” as investors risk missing out on further gains until the rationale for the upward trajectory presents itself.
For example, he saw oil and oil‑service stocks going up and bought more in his portfolio at the start of 2026 “because of the momentum factor and because the troubles in the world suggested that this was going to work this year”.
Another market phenomenon that has become popular in recent years that investors need to be watchful of is the meme stock craze, whereby influencers who create a following “can get everyone to pile in and act in concert with them”.
Headlined by the GameStop saga in 2021, targets tend to be well‑owned by hedge funds or have lots of their shares out on loan to short sellers.
“If there’s a big short‑sale position in the stock, you might get a concert party to buy it to squeeze the shorts. Then the shorts have to buy it in at a high price. And the people manipulating that then sell to the shorts,” de Lisle said. Once done, the stock plummets again as investors sell out.
“Stocks get bumped up, they get bumped down, you don’t know why, but you know there are certain tell‑tale signs,” he added.
“When you see the footprints – Oh, that’s rushing up, ah, it’s got a big short position – as investors, [you have to be] in a position not to be fooled by that.”