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Most Recent Insider Selling to Buying Ratio: 82:1

Tyler Durden's picture





 

You would think that insiders would finally change their tune after almost a year of straight line gains in the market. Think again. The most recent insider trading data from finviz indicates that insider sellling outpaces buying by a ratio of 82! In the most recent data set, $11.6 million in stock was purchased by insiders, while a whopping $957 million was sold. And somehow pundits are still spinning this mass orchestrated sell into the bid by those in the know as a bull market.

 

Insider Trades 12.7 finviz -

 


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Mon, 12/07/2009 - 10:45 | Link to Comment Cursive
Cursive's picture

Well, someone likes this market.  What the heck is it doing above 1100?  It couldn't be DISTRIBUTION, could it?  I can't wait for the mother of all clawbacks.

Mon, 12/07/2009 - 11:37 | Link to Comment Divided States ...
Divided States of America's picture

Yeah, could be the foreigners snapping up houses in the USA like mad and now thinks stocks are cheap. I mean first the Foreigners took away our jobs, then they want to take away our homes, and now they want to take away our identity. What a great country this is. Thanks Obama for the change.

Mon, 12/07/2009 - 13:57 | Link to Comment Master Bates
Master Bates's picture

Actually, Bush crashed everything.  Everybody wants to blame Obama, but the market hit new lows 2 months before he was sworn in, and 2 months after.  That can hardly be blamed on him, no matter how much Fox tries.

Mon, 12/07/2009 - 14:13 | Link to Comment Divided States ...
Divided States of America's picture

Obama was the saviour. We were expecting drastic changes for the better, yet he has only made the situation worse. It is definitely his fault.

Mon, 12/07/2009 - 15:35 | Link to Comment Anonymous
Mon, 12/07/2009 - 10:46 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:54 | Link to Comment Anonymous
Mon, 12/07/2009 - 12:44 | Link to Comment Anonymous
Mon, 12/07/2009 - 12:50 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:11 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Let's see. Insiders selling, mutual funds experiencing outflows from equity funds for months, hedge fund disbursements continue, pension, private equity and other smart money moving away from stocks to bonds or cash, 401(k) money shifting to bonds, along with lower contributions from participants and a major increase in 401(k) loans.

Who's left in the stock market? Oh, I know.

Just Mr. and Mrs. Taxpayer, backing up the Federal Reserve. I can see this will end well.

Mon, 12/07/2009 - 12:18 | Link to Comment Cursive
Cursive's picture

This is my thinking, as well.  Most participants are out of the market (look at the dramatic drop in volume) and the participants that are left, e.g. big banks and brokerages, all have a nod from the USG that they'll be backstopped.  Now, if anyone got the notion that the backstop were not there or that it would be removed, look out below.

Mon, 12/07/2009 - 15:13 | Link to Comment Anonymous
Wed, 12/01/2010 - 01:37 | Link to Comment Karston1234
Karston1234's picture

But if you go to buy, those transactions aren't included. So I don't think option exercises are included in the buys for the chart above.accounting degree | engineering degree | business administration degree

Mon, 12/07/2009 - 11:01 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:57 | Link to Comment bugs_
bugs_'s picture

The Munder Air Guitar Fund.

Mon, 12/07/2009 - 15:08 | Link to Comment Assetman
Assetman's picture

Righteous, dude!

Wed, 12/01/2010 - 01:37 | Link to Comment Karston1234
Karston1234's picture

Thanks for a nice share you have given to us with such an large collection of information.
business management degree | computer science degree

Mon, 12/07/2009 - 11:02 | Link to Comment AnonymousMonetarist
AnonymousMonetarist's picture

Watch the rats

Mon, 12/07/2009 - 11:06 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:10 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:16 | Link to Comment Fish Gone Bad
Fish Gone Bad's picture

I could not figure out how Bank of America was trading at $229.20.  The symbol (BLK) is for Blackrock.  I stopped looking after the very first item was incorrect.

Mon, 12/07/2009 - 11:28 | Link to Comment Anonymous
Mon, 12/07/2009 - 12:47 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

I believe you may be looking at this list incorrectly. This is a list of individuals (or entities that are considered individuals for insider trading purposes) that are buying or selling. 

Bank of America, which it appears has a seat on the Blackrock board as a director (represented by a human being but still technically B of A) and which because BofA has a 5% or more ownership relationship with Blackrock and is thus a insider, was buying. Thus it is listed that way. 

Mon, 12/07/2009 - 15:41 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:18 | Link to Comment Anonymous
Mon, 12/07/2009 - 11:40 | Link to Comment Mad Max
Mad Max's picture

Question: how are stock grants of various kinds accounted for?  Is it possible that this ratio is misleading because the insiders are acquiring their stock in ways that are not counted as purchases?

It's an alarming ratio in any event, but I would like to know if it truly reflects insider pessimism or if it's misleading because the insider acquisitions aren't being fully counted.

Mon, 12/07/2009 - 11:51 | Link to Comment Anonymous
Mon, 12/07/2009 - 12:25 | Link to Comment Anonymous
Mon, 12/07/2009 - 12:38 | Link to Comment quezrho
quezrho's picture

I don't think this particular point is as negative as it would be in normal times.  Back when stocks cratered, many execs either were put into ruin or scared shitless that they were going to be.  There was a very widespread incidence of individual liquidity issues that none of these guys felt ever before.  They didnt sell then because they thought the stock was too low vs the safety of liquidity.  Now that things are up, it is the reasonable thing to do to ensure liquidty issues dont happen again.  The flight to safety is due to history not expectations.  Now, that is not to say I am bullish, nor that these execs are.  It is simply tat this measure is not as meaningful as normal.

Mon, 12/07/2009 - 12:37 | Link to Comment Anonymous
Mon, 12/07/2009 - 13:03 | Link to Comment Anonymous
Mon, 12/07/2009 - 14:33 | Link to Comment Anonymous
Mon, 12/07/2009 - 18:48 | Link to Comment whwood75
whwood75's picture

 

While it seems possible to reach a similar result to that presented above regarding the ratio of insider buys to sells, I am not able to replicate the data which are presented.

I've never used FINVIZ before so it could be that I am being an idiot. But, when I go to the web site following the link provided (http://www.finviz.com/insidertrading.ashx) I have a choice to select one of three report formats: (1) Latest Insider Trading, (2) Top Insider Trading Recent Week, or (3) Top 10% Owner Trading Recent Week. The site then allows you to filter by (a) All Transactions, (b) Buy Transactions or (c) Sell Transactions. 

I generated each of the three report formats in the All Transaction format. In order to try to match the data in those reports with the green and blue background data provided in the report above, I search for three completely arbitrary records contained in the above report in each of the three formats: (1) Kudelski (OPTV), (2) HOVDE (CALC), and (3) LAWLOR (ORCC). Only the record for the Kudelski (OPTV) trade of 1,242,62 shares showed up and that only showed up in the second and third report formats. 

In addition, I downloaded the Buy and Sell data from the second report format ("Top Insider Trading Recent Week") in two batches (one buy, one sell) and put it into Excel and summed up the number of shares and the total dollar value for each. (Option excercises appear to get lost but they are relatively small change in the whole picture.)

Here's what these data showed:

Insiders sold 48,713,309 shares with a total value of $974,556,860.

Insiders bought 4,994,036 shares with a total value of $37,545,212.

The sale total is very close to the number shown but the buy total is more than three times higher. OK, so my ratio is 26:1. Big deal perhaps, what is the difference? And why don't the names foot?

Finally, what is the difference between the formats and which format is really meaningful. This question is worth asking because when I do the same buy / sell analysis I did above but use the first report format instead ("Latest Insider Trading"), I get these results instead:

Insiders sold 15,250,559 shares with a total value of $168,819,750.

Insiders bought 9,863,797 shares with a total value of $594,446,512.

(Note also: One single trade accounted for $500 million of the $594 million total.)

At the very least, I think a little more explanation regarding how the summary data were reproduced from the source cited would be helpful for those of us who are trying to learn how to follow and interpret these same data going forward.

 

Mon, 12/07/2009 - 19:09 | Link to Comment omi
omi's picture

Nothing screams conspiracy like pre-planned selling.

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