Insider Buying Non-Existent As Markets Continue to Surge
Zerohedge.com (link below) posted an article earlier today titled "Insider Selling Outpaces Buying by 24 Times in Last Week".
In the article, the author points out that insiders bought just $18 million dollars worth of stock last week, compared to insider sales of over $400 million dollars ($419 million, to be exact).
The markets have been locked in continual rally mode since hitting rock bottom in March of 2009. Insiders have taken the opportunity to hit the exits, selling shares into the never-ending rally (the DJIA, for instance, is up over 4,000 points since March of '09).
Now, there are many legitimate reasons why insiders sell shares. For example, many executives have automatic share sale plans that they use to diversify their net worth.
It's not the insider sales that are troubling - instead, it's the lack of insider buys.
It's not a real surprise that company insiders are reluctant to commit substantial cash to insider buys, given the surge in the markets over the past 10 months.
However, the lack of insider buying doesn't exactly inspire confidence. If they aren't buying, then why should the average investor think of buying at this point?
Or, a better question - what should stop the average investor from selling?
Source: Zerohedge.com - Insider Selling Outpaces Buying By 24 Times in Last Week
Photo: Mauricio Duque
Filed under: General Market News