Chief executives. Board members.Gee, you think?
The head honchos. The people who know.
Just a few weeks ago, they were out in force, buying up shares in their own companies with both hands.
No longer. They’ve disappeared. Almost overnight.
“They’ve stopped buying,” says Charles Biderman, the chief executive of stock market research firm TrimTabs, which tracks the data. “Insiders aren’t buying this rally.”
Insider stock purchases, which surged above $100 million a day in the market slump last month, have now collapsed to just $13 million a day.
Meanwhile the ratio of insider sales to purchases has skyrocketed. Today insiders are dumping $7 in stock for each $1 that (other) insiders are buying. That’s a worrying ratio. Six weeks ago the amounts of purchases and sales were about equal.
It’s the kind of news that should give investors pause.
What insiders do with their own money is one of the stock market’s best barometers.
But ……… That would mean ……… That our noble captains of industry are using their internal knowledge of their businesses to derive an undeserved profit!
As the saying goes, "If you sit in on a poker game and don’t see a sucker, get up. You’re the sucker."
Time to get out of the big casino if you are in.
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