Insider Selling To Buying Ratio: 2,842 To 1

Insider Selling To Buying Ratio: 2,842 To 1

In the week ending January 21, the S&P 500 saw 2 insider buys (Tiffany and Fastenal for a total of $131,227) and 60 insider sales, worth $373 million, for a total insider sell-to-buy ratio of 2,842x.

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if you think this number is out of the ordinary you should see the ratio through this entire bull market rally we've had since march of '09. makes you wonder, when the people running the companies of the s&p500 are selling hand over fist, who is dumb enough to be buying them and running up the price this whole time? i'll let you think about that for a bit before i give you the answer.

Zyroh said:

Insider Selling To Buying Ratio: 2,842 To 1



if you think this number is out of the ordinary you should see the ratio through this entire bull market rally we've had since march of '09. makes you wonder, when the people running the companies of the s&p500 are selling hand over fist, who is dumb enough to be buying them and running up the price this whole time? i'll let you think about that for a bit before i give you the answer.

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I'm confused about your point...Do you believe that all of these insiders are selling because there are individual problems in 2,842x more companies? Or do you think they're selling because they perceive some systemic risk in the economy as a whole?

Insiders only have more of a financial incentive to sell off stock in their own company if they know about company-specific problems that the public does not (and doing so is illegal). If they're just acting on their hunches about the direction the entire stock market is going to move, there is no reason to give their opinion any special credence. They don't have any greater access to macroeconomic data than anyone else does.

Additionally, while I wouldn't recommend investing in stocks that the executives are dumping, you should EXPECT the overall amount of insider selling to be significantly higher than insider buying. Why? Because executives are often compensated in stock when they'd rather be compensated in cash.

my point is that this ratio has kept even for over a year now, and the whole time retail investors have also seen outflows every single week except one. and yet the price for these securities continues to go up. so i ask the question again, who is investing in these companies driving up the prices?

Zyroh said:

my point is that this ratio has kept even for over a year now, and the whole time retail investors have also seen outflows every single week except one. and yet the price for these securities continues to go up. so i ask the question again, who is investing in these companies driving up the prices?

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.....the government???

Stupid day traders? Or could it be that one of the reason insiders sell is to increase their income so that they can buy expensive stuff?