Its been one of my best plays over the years. I'm not a daytraders, though. More of a 2 week to 2 yr type position trader. But I've had good luck where I've been able to get in near or below the insider buy prices, unless they have been the cheesy 1000 share type, where its a trick if you know what I mean. Anyway, one holding, GSS, had another 50,000 share insider buy filed after hours tonight. Its also the most heavily shorted mining stock on the AMEX, trading at 1/2 what it was 3 yrs ago. Their new expansion is coming online, and gold is up, and that's why things are moving. heres a link to the filing http://phx.corporate-ir.net/phoenix...yZXBvPXRlbmsmaXBhZ2U9NDc1NTM4MSZhdHRhY2g9T04= If anyone else know of a filing and posts it in a timely manner (so I can move before after it skyrockets the next day), please post them.
It can be a great strategy...unfortunately I think in some smaller companies it's used as a way to get investors to feel more comfortable about buying. Nothing wrong with that, but it's something to be aware of. Now selling on the other hand is never an IR guys idea.
There is a site I check on that tracks them. It has the ability to show buys, sells or all. http://www.j3sg.com/predefined/dailyFilings.php I agree with the comment. I use them to trigger a look at the stock, not as an automatic load the truck signal. I already own a bunch of GSS, so I was real happy to another buy. when the CFO plunks down $200,000 of his own money it sure sends a message to the shorts that they are REALLY on the wrong side of the trade. One I got burned on was CURE. They had done a takover and hired the CEO from the company and he bought hundreds of thousands of shares. I didn't take the time to investigate the details of why. Later as the stock dove I found out that his employment contract came with a big sum of cash but required him to spend a large portion of it on shares in the subsequent months. In the end they went bankrupt. After losing about 8% on that before exiting I learned to be more careful.
I do use Insider trading as a filter it's not a good baromiter any more. One thing is these fat cats have so much Fuc*ing money they make puke buys so the first screen you see on Street.com is all buys. A typical buy sequence would be a whole slew at the same unit ammount say 15,000 shares! And you're left saying I only want 800! But closer inspection reveals they all dumped 100,000 shares each two months before! There are some strange companies that never move in price yet are filled always with insider buying. I don't know if the affecrt is to prop up the stock or what? Usually I would never reccomend a service without trying it. But I have lots of peeps in the brokerage and finance community and know lots of investors obviously and I am hearing very good things about a new Insider tracking service that includes lots of good commentary and seperates the wheat from the chaf if you would.. The name is InsiderInsights and the editor is Johnathan Moreland. Once again I have not tried this yet I plan to sign up soon and take a look but I have heard the same name come back from a few differen't people so I thought I would pass it along.
I'd add these couple of conditions. 1. Insider buying when stock is at a low, could be 52 week low, 6 month low, etc. 2. Buy amount at least $125k. Small amounts mean tiddly squat. 3. If that certain insider has a history of buying and the stock goes up, better ride his/her coat tail.
Look at its weekly chart, I just don't understand why so many people want to short a stock with such beautiful rising pattern.
If you liked seeing the CFO purchase 50,000 shares (March 19)then you must really love seeing the CEO exercise options on 940,000 shares 2 days later, March 21! (If I read this right) http://finance.yahoo.com/q/it?s=GSS (Actually, it looks like the CFO was frontrunning the CEO! )
10K, 8K, 10Q's, etc. are all a basic part of everyone's trading planning, or sure should be. We analyze all the fundamental data, including share allocations, before diving in to any strategy. My brother always reminds us that "...if you're buying or shorting a stock for a day, week, or year, you should feel comfortable with that position for a lifetime." We keep core positions on hundreds of stocks in our pairs, based on this fundamental info (and modify as things change, this work never stops). FWIW, Don
Thanks for the link TBob - I signed up for the email updates, but I can't seem to find what the "Rankings" mean. Can you provide any insight?
I'm confused by that link to the filing you posted. It says silly stuff from Oct of 03 filing or am I not seeing something?