1. Program trading is defined as automated trading generated by computer algorithms designed to react rapidly to changes in market prices. Is it ethical for investment banking houses to operate such systems when they may generate trade activity ahead of their brokerage customers, to which they owe a fiduciary duty?
2. Suppose that you are an employee of a printing firm that was hired to proofread proxies that contained unannounced tender offers (and unnamed targets). Should you trade on this information, and would it be considered illegal?