I agree with you that it's possibly unanswerable, which is more or less the point. The broader idea is that there are lots of obscure interactions like that one I made up.

You can switch up the doctor and CEO patient for anything else. Bankers, lenders, family friends, former professors ... An unbounded number of humans that can come into contact with useful info to trade on. What do we think are the magical constraints that prevent them from doing so? Corporate etiquette?

The ROI will obviously be a function of what information is passed. But I think that I'm more interested in understanding how often it happens rather than that any one case is "low ROI". It is interesting to consider whether it's the ROI threshold that should philosophically make/not make something insider trading.

But nearly all of that isn’t going to be actual insider trader, which is pretty narrowly defined: https://www.investor.gov/introduction-investing/investing-ba...

That would be like saying there are 300 million peanut butter and marshmallow fluff sandwiches eaten a year because that’s the total number of sandwiches made in a year. https://www.ezcater.com/lunchrush/office/state-of-the-sandwi...

Isn't it literally all included in this umbrella section?

> Friends, business associates, family members, and other "tippees" of such officers, directors, and employees, who traded the securities after receiving such information;

Never in a million years would I have guessed that there have only been 9000 IPOs in the last nearly half-century. Really drives home how many US businesses are privately owned.

It is surprising that it's such a small number, but upon reflection maybe not so surprising. Stock markets were invented to allow massively capital intensive businesses like railways to get off the ground. You can't grow a railway organically by reinvesting profit like a regular business; it needs to be fully built before it can bring in a penny. Naturally there can only be so many of these businesses. In the case of railways they usually become natural monopolies. So being publicly owned was a really great thing.

But most businesses don't need such large capital injections anyway. They can grow organically, and there's very little reason to sell a profitable company. Although it does happen, of course, Google being a prime example, having gone public when already profitable.

It looks like they were only looking at the NYSE and Nasdaq. Smaller companies would not qualify to trade on those exchanges, they would trade over-the-counter. There are more OTC stocks than there are that trade on NYSE/Nasdaq.

"The sample is composed of the IPOs of U.S.-based companies with an offer price of at least $5.00 and listed on the NYSE (excluding NYSE American and NYSE MKT issues after the merger in 2008) or Nasdaq (excluding Nasdaq small cap issues before October 2005 and, after Sept. 2005, Nasdaq capital market issues), excluding ADRs, unit offers, SPACs, closed-end funds, REITs, partnerships, banks and S&Ls, and stocks not listed on CRSP (CRSP includes Amex, NYSE, and NASDAQ stocks)"

But not only the physicians know a CEO will be out of commission. And there are many more cases where a CEO will leave a company without being ill.

And there are much more situations that will influence stock prices than a company changing its CEO. Those situations can be both internal and external to a company.

So I think we potentially have thousands or tens of thousands of people who learn information that make them rich if they act quickly. And even that has a multiplying factor since those people have friends and family.

"Hey Bill, wanna make a quick buck? As soon as market opens buy XYZ. You don't know it from me and I didn't call you today."

Also, most of the situations you are describing are not insider trading. If Warren Buffett calls his secretary and tells them he needs to go to the hospital because he’s having a heart attack, and they short BH on the way, that _could_ be considered insider trading. If I’m a nurse at that hospital and I’m on break outside and watch Buffett being wheeled in on a gurney and I trade on that, that would generally not be.

>But not only the physicians know a CEO will be out of commission.

Ok, but I was responding to a specific claim from the parent comment specifically mentioning physicians.