How does Section 16(b) of the Securities Exchange Act of 1934 protect the interests of a corporation? Explain with an example

What will be an ideal response?

Section 16(b) of the Securities Exchange Act of 1934 requires that any profits made by a statutory insider on transactions involving short-swing profits—that is, trades involving equity securities occurring within six months of each other—belong to the corporation. The corporation may bring a legal action to recover these profits. Involuntary transactions, such as forced redemption of securities by the corporation or an exchange of securities in a bankruptcy proceeding, are exempt. Section 16(b) is a strict liability provision. Generally, no defenses are recognized. Neither intent nor the possession of inside information need be shown.
Example—Rosanne is the president of a corporation and a statutory insider who does not possess any inside information. On February 1, she purchases one thousand shares of her employer's stock at $10 per share. On June 1, she sells the stock for $14 per share. The corporation can recover the $4,000 profit because the trades occurred within six months of each other.