Daily Spotlight

Insiders Respond to Trade News

When stock markets got wobbly in mid-May on renewed trade tensions, we wondered if corporate insiders would step in and buy the dip or go "Henny Penny" and sell stocks as if the sky was going to fall. Now, we have our answer. Stocks have not clawed back all of the ground given up on renewed trade agita. But for their part, corporate executives, directors and beneficial owners did indeed scoop up shares. In the week following the trade-related drop in share prices, the Total One-Week Sell/Buy Ratio from Vickers Stock Research was 1.80. That is a positive result on a scale where anything under 2.00 is bullish; anything between 2.00 and 2.50 is neutral; and anything above 2.50 is both the norm and is bearish (as insiders typically sell shares on the open market far more often then they buy shares). With the positive one-week input, the eight-week moving average for the Total dataset is a benign 2.93 and has been in a positive trend since early March. While there are many moving parts in the world these days, for now we maintain a bullish outlook when that outlook is based on the actions of corporate insiders. ...  is bearish (as insiders typically sell shares on the open market far more often then they buy shares). With the positive one-week input, the eight-week moving average for the Total dataset is a benign 2.93 and has been in a positive trend since early March. While there are many moving parts in the world these days, for now we maintain a bullish outlook when that outlook is based on the actions of corporate insiders.    more

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