The Explanatory Power of Insider Buying

Don’t forget to FOLLOW the MONEY.  What are insiders doing?  The video of Mark Hulbert on insider buying is interesting for two reasons:

Insider buying has more explanatory power on long-term (greater than one year) stock returns according to Professor Nejat Seyhun.   Also, note that when insiders do NOT sell when prices fall that is a bullish sign. Insiders seem bullish.

Video on Insider Buying

http://www.marketwatch.com/video/asset/gauging-insider-actions-as-trading-trigger-2011-12-06/A8DB6956-E0A4-462E-AFD4-CB3B74106EEC?siteid=bigcharts&dist=bigcharts#!A8DB6956-E0A4-462E-AFD4-CB3B74106EEC

Bullish Insiders Point to One-Year Stock Gains Dec. 6, 2011
Market insiders (such as executives) and their activities may have greatest sway as an indicator at the one-year horizon, not the three-month or six-month time span, according to Mark Hulbert. Laura Mandaro reports.

Resources for Studying Insider Buying

A resource for tracking insiders and learning more:

http://www.insider-monitor.com/resource.html

http://insidertrading.org/

http://www.insidertrade.net/

Academic Research on insider buying. You can do a search yourself.

http://deepblue.lib.umich.edu/bitstream/2027.42/79151/1/j.1755-053X.2010.01074.x.pdf

http://69.175.2.130/~finman/Orlando/Papers/AggregateInsiderTrading.pdf

Keep learning/studying and having fun.

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