| Freeriding | |
 1. An illegal practice in which an underwriting syndicate member withholds part of a new securities issue and later sells it at a higher price. 2. The illegal activity of buying a stock and selling it before paying for the purchase. |
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 Due to the unfair advantage both of these practices give to those able to exploit freeriding opportunities, freeriding is illegal and prohibited by the Securities & Exchange Commission and the National Association of Securities Dealers. |
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