Stock blackout period regulations

January 13, 2006 1:08 PM

I work for a public company that seems to have frustatingly long stock blackout periods around their quarterly earning calls (~2 months). I'm wondering if this is normal, and if the blackout period length is an arbitrary decision or somehow regulated by law. I'm mainly just curious about the regulations surrounding such a period.
posted by anonymous to work & money (4 comments total)

Most blackout periods of which I am familiar are for 60 days, so your seems normal.

Check out...

Blackout and Window Periods -- Corporate Survey Results.
posted by ericb at 1:25 PM on January 13, 2006

Final Regulations on Blackout Notices and Restrictions [PDF]
posted by ericb at 1:30 PM on January 13, 2006

It's so you can't engage in insider trading.

Insiders (like yourself) might know some secret company info, and want to trade on it. But you don't want to get busted by the SEC, so wait until 2 seconds after the conference call to trade the stock -- "see, I waited until the information is public!" But of course this violates the spirit of insider trading laws, so the blackout period is enforced to protect against such shenanigans.
posted by falconred at 5:19 PM on January 13, 2006

Not quite on point, but the best way to avoid any suspicion of insider trading is to give your stock broker specific instructions well in advance - for example, that the broker should, every three months, sell 1,000 shares at market price (or 10% of your holdings, or enough shares to generate $10,000, or whatever).
posted by WestCoaster at 8:34 PM on January 13, 2006