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Big Questions for Money Moments

How do I navigate these restrictions?

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insider trading

If you are an employee with potential access to material company information, you are likely an “insider” and subject to trading restrictions. These restrictions typically limit insiders to trading in so-called open windows — pockets of time following the announcement of company earnings to the public. Insiders can sell company stock in these open windows only if they do not possess “insider information” — material information that has not been disclosed to the public at large. A 10b5-1 trading plan is a way for insiders to circumvent these restrictions and sell company stock throughout the year. Trading plans must be submitted for approval in an open window period and follow certain parameters set by the company. Benefits of a trading plan include:

  • The ability to sell throughout the year, potentially capturing more price points (a positive when navigating market volatility);
  • The flexibility to set different minimum (limit) prices and sequence the sale of different equity awards for optimal tax results;
  • The ability to sell equity grants as they vest; and
  • The potential to reduce the risk of paralysis as a result of insider information.

If you are an insider and in need of a 10b5-1 trading plan, you’ll want to work with an advisor with 10b5-1 plan expertise. Contact a Cerity Partners advisor to learn more.


Cerity Partners LLC (“Cerity Partners”) is a registered investment adviser with offices in California, Colorado, Florida, Illinois, Ohio, Michigan, New York, Massachusetts, and Texas. Registration of an Investment Advisor does not imply any level of skill or training. This commentary is limited to general information, and should not be construed as personal investment advice. There is no guarantee that the views and opinions expressed in this piece will come to pass. The information is deemed reliable as of the date of this commentary, but is not guaranteed, and subject to change without notice. It should not be considered as an offer to sell or a solicitation of an offer to buy any security.


Meet the Author

Aaron Waxman

Partner

Aaron is a Partner based in the San Francisco office. He provides comprehensive investment and planning advice to individuals. While Aaron works with a wide array of clients, he has expertise in working with multigenerational families, business executives, and entrepreneurs with above average income and estate tax planning needs.

Before joining Cerity Partners, Aaron was a Principal at B|O|S and served on the firm’s Board of Managers, strategizing firm-wide initiatives and making critical decisions on the day-to-day functioning of the firm. Prior to B|O|S, he worked for PricewaterhouseCoopers LLP as a Manager in the Private Client Services Group.

Aaron placed on the Forbes “Best-In-State Wealth Advisors” list for the San Francisco region in 2019, 2020, and 2021. In 2019 he also ranked on Forbes “Top Next-Gen Best-in-State Wealth Advisors” list for California and on its “Top Next-Gen Wealth Advisors” list. Additionally, in 2017, Aaron was the recipient of a “40 Under 40 Award” by the San Francisco Business Times.

Aaron earned his Bachelor of Science in Finance from Santa Clara University. He holds both the Certified Financial Planner (CFP®) and Certified Public Accountant (CPA) designations as well as a Series 65 license. Aaron is a member of the Stern Grove Festival Association Board of Directors. He previously served on the Board of Directors for the Headlands Center for the Arts, Step One School, and Blind Babies Foundation.

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