The SEC investigates unusual activity in a stock. Its investigation diligence is independent of the sizes of transactions. So if there is unusual activity, and the SEC investigates, you could get in trouble for trading a single share. To be safe, you would have to route trades through an unrelated party – which would involve you transferring cash to that party, which would then be detected by the IRS, assuming you routed significant amounts of cash. And, as "sandiego" pointed out, if you do not do this with significant amounts of cash, it will not return enough to be worthwhile
Yup. Think Dow Jones and the joker that attempted to inside trade there. You'd be surprised the reach of the SEC. This is particularly why I don't play stocks in the retail sector. One of my siblings does market research for I-banks and covers retail sector, does recommendations for hedge funds/ private equities etc.. I don't step within 1 foot with any companies she covers or plans to cover.
The way I look at it. It's a catch 22. For you to profit a lot from this, you would have to buy lots of shares. You most likely will get flagged for that. If you buy little shares, it won't make much of a difference. And frankly, if your company gets bought by an exorbitant price, your current stock options/stock the company gave you should be more than enough compensation. You did negotiate these when you joined your company, right? So why dick around with your own money for a couple of thousand extra? It's not worth it.
