Monday, April 27, 2009

Insiders Selling into Rally

Is this a good or a bad thing? I know one thing it is never a good sign when insiders start selling. Insider selling is often a barometer of confidence.

Lack of confidence in their own company by insiders is often followed by negative reporting down the road.

Is it panic? Or, is the outlooks so dismal that insiders want to get out why the gettin is good.

If you own a stock, and the insiders are selling, it is usually a red flag.
Executives and insiders at U.S. companies are taking advantage of the steepest stock market gains since 1938 to unload shares at the fastest pace since the start of the bear market.
While the Standard & Poor’s 500 Index climbed 28 percent from a 12-year low on March 9, CEOs, directors and senior officers at U.S. companies sold $353 million of equities this month, or 8.3 times more than they bought, data compiled by Washington Service, a Bethesda, Maryland-based research firm, show. That’s a warning sign because insiders usually have more information about their companies’ prospects than anyone else, according to William Stone at PNC Financial Services Group Inc.
Do insiders know something you don't know?

Insider Selling Jumps to Highest Level Since 2007
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