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INSIDER BUYING IMPROVES, BUT STILL LOPSIDED

9 November 2009 by Cullen Roche 2 Comments

Total insider buying picked up in the latest week with a total of $118MM in buying.   Selling continues to overshadow the buying, however, with insiders selling $739MM in stock.  Both buying and selling jumped from the latest week’s data.   Buying increased by $73MM for the week while selling increased by $284MM.

After the brief decline in the markets it’s encouraging to see some insiders buying the dip, however, the selling continues to overshadow the buying.  As we’ve previously noted it’s important not to overemphasize the insider selling.  Insiders sell for a number of reasons, but they only buy their own shares when they have confidence that those shares will rise in the future.  For now, the latest data on insider buying is encouraging, but whether this turns into a trend or not is still very much in doubt.  The low historical level of buying can only be seen as a continuing vote of no confidence in stocks going forward.

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Cullen Roche

Cullen Roche

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Comments
  • silly things

    Historically, is this a leading or trailing indicator?

    Considering the market is up 60% since March, if this is a trailing indicator what good is it?

    11/09/2009 at 12:34 PM
  • Mike

    I think the inside selling would be a leading indicator because market insiders will always know more about their companys immediate future then the average trader.

    11/09/2009 at 8:00 PM