One up on Gordon Gekko — Four rules to profit from director trading

There’s that stretch over the Christmas holidays when the days all blur together. You can't tell if it's December 27th or 28th. I passed the time with movies, starting with the Christmas classics (I was forced to sit through Muppet's Christmas Carol) before moving on to Oliver Stone's Wall Street. The film stars Michael Douglas, as the ruthless tycoon Gordon Gekko, and Charlie Sheen as Bud Fox, Gekko’s eager apprentice.

There’s that scene where Gekko needs share tips. Bud Fox produces some run-of-the-mill analysis. Gekko shoots back: ‘Come on, pal. Tell me something I don’t know… It’s my birthday!’ A bead of sweat drips down Bud's forehead as he searches the darker recesses of his mind, knowing that this is the point he should not cross.

‘Bluestar…’ Bud forces a response. ‘Bluestar Airlines! They just got a favourable ruling on a law suit. The decision would clear the way for new planes and route contracts.’

‘Well how do you know about it?’

Bud gulps. There is another stretch of silence as more sweat drips down his forehead. He can only muster, ‘I just know…’

Spoiler alert! Towards the end of the movie Bud is arrested for insider trading. The information Bud passed on to...