reports insider selling highest since June of 2007

Discussion in 'Wall St. News' started by ByLoSellHi, Aug 18, 2009.

  1. Insider Selling Increases on the
    Heels of Q2 Earnings Reports…
    Time to Follow the Smart Money out the Door?

    By Eric Roseman
    August 19, 2009

    According to, U.S. corporate insider selling reached its highest levels for the week ending August 11 since June 5, 2007. tracks publicly traded buying and selling activity in the United States, and it’s the best service I’ve seen focusing on this discipline.

    The recent data continues to paint a bearish picture on insider trends. Insiders, who must file with the SEC after making a transaction, have been aggressively selling company shares since last spring. reports that companies marked by selling, outnumbered those with buying by more than a 2-to-1 ratio – the first time that’s occurred since the week ended February 27, 2007.


    Insiders at publicly traded companies know their company prospects better than anyone else – better than Wall Street analysts, money-managers and traders. They see the numbers and orders every day and have a great gauge of where company revenues are headed.

    Ahead of earnings or big changes in business plans affecting gross revenues insiders will typically file with the securities authorities following cash-based purchases of company stock. If an insider is buying it’s because he or she believes share price are heading only in one direction – higher.

    But the trend in net selling since last spring is a bad omen for a market lacking the conviction from its most ardent supporters – executives and directors of publicly traded companies who usually vote with their wallets.

    Are the insiders right?

    I can’t argue with the trend in big money – they’re bearish and taking money off the table.

    I would too.