Why? Because they have access to all sorts of information, like... - The direction of sales since the last quarterly report
- New products and services in development
- Any expansion plans
- Potential mergers and acquisitions
- Whether the company has gained or lost any key customers
- The status of outstanding litigation
- Whether the company will put itself up for sale
- Plans to take the company private
... And plenty of other good stuff that those of us on the outside looking in may not fully understand. That's why the Securities and Exchange Commission requires corporate insiders - officers, directors and beneficial owners - to file a Form 4 within two business days of any purchase or sale, detailing the number of shares bought, on what date and at what price. Making this information public at least levels the playing field. (You may not know why the insiders are buying. But at least you can see that they are.) If you want to increase your stock market returns, you need to know what the insiders are doing. Buying stocks that insiders are bailing out of or selling stocks that they are eagerly buying is a fundamental mistake. Even when corporate fundamentals are checkered or poor, if the insiders are buying heavily, it is generally a sign that the problems are temporary, and the stock is set to press higher. Indeed, plenty of academic studies have confirmed that stocks with heavy insider buying tend to outperform the broad market in the months that follow. Do you know which stocks the insiders are piling into right now? You should. Because those are the companies whose shares are most likely to perform best in the weeks and months ahead, no matter what the broad market does. YOUR ACTION PLAN Knowing where insiders are putting their money has been my most coveted strategy for making consistent profits in the market for the last 30 years. And right now, I'm giving readers exclusive access to my No. 1 insider stock of 2024, plus all my recommendations in 2025 through my VIP email list. Click here to unlock my Insider Alert service. |
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