Businessweek looks at the “shadowy” business of political intelligence — “gathering inside information on executive, legislative, and regulatory developments and selling it to Wall Street investors, who pay large sums to keep abreast of what’s going on behind the headlines and trade on it before anyone else.”
“It’s clear such information is valuable. An August 2014 paper by two finance professors at the University of Illinois at Urbana-Champaign found that hedge funds which hired Washington lobbyists ‘gained an informational advantage in trading politically sensitive stocks’ and outperformed funds that didn’t by 63 to 87 basis points per month… Is it legal? That’s a murkier question.”
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