Purpose is to prevent unfair use of inside information and manipulation of price. Done by imposing strict liability - no proof of inside information is required. Purchase and sale or sale and purchase within 6 months; if difficult to determine if a transaction was a sale, the test is whether this is the kind of transaction in which abuse of inside information is likely to occur. applies only to equity securities (such as options, warrants, preferred stock, common stock) applies only to officers, directors, or 10% shareholders