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Some Perspectives On "Surging" Insider Buying

Tyler Durden's picture




 

Based on repeated soundbites played on Comcast's financial comedy channel one would be left with the impression that corporate insiders have completely stopped managing their companies and all they do is sit feverishly in front of E-Trade, and punch F5, buying up their own stocks with relentless abandon. Alas, this is about as far from the truth as BLS data from reality.  Below are four charts that present the full picture.

First, insider buying on a daily basis. Noe the market value for All purchases which peaked at $8 million and has since plunged almost back to historical trendlines of, well, $0.00. Yes, the whole "bull" story is based on roughly $20 million worth of insider purchases in the past week. That's right. $20 million. That's in line with what one CEO makes per year, and a little less than FoxConn raises during one bake sale! And furthermore, the buying is drying up, even as the market continues to sink to new lows, which means that after the first plunge spurred insiders to buy, buy, buy, the following subsequent plunges may have forced them to reevaluate their enthusiasm.

How about selling? Well, here's the data. Once again, keep an eye on the axis: the peak is about $140 million... a little under 20x more than the peak buying. Just keeping things in perspective here.

How about on an average basis? Here is the monthly moving buying average: just about $1.3 million.

And selling. Once again: compare the axes, and the trailing selling average, which happens to be a little over 20x higher than buying.

So, uh, yeah.

 

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Thu, 08/11/2011 - 13:56 | 1551505 achmachat
achmachat's picture

reading ZH right after listening to the CNBC heads: priceless

Thu, 08/11/2011 - 14:05 | 1551530 Hard1
Hard1's picture

Not just insiders trading.  The Hedge Fund strategy called "event-driven" makes no sense from a financial standpoint unless they have an informational advantage.

Thu, 08/11/2011 - 14:23 | 1551560 bigdumbnugly
bigdumbnugly's picture

the surging inside is just the precursor to the cornholing to come later.

Thu, 08/11/2011 - 14:29 | 1551584 TruthInSunshine
TruthInSunshine's picture

It's 2:29 and I guarantee that RoboTard BTFD yesterday, at the very close, or so he'll be along to tell us in the event this market closes green (or if some obscure equity, which he picks out from the crowd, does, in which case that will be TFD he bought).

 

Okay, it's 2:30. This is like watching baseball, where unless you are really bored, you only really want to watch the 9th inning.

Thu, 08/11/2011 - 14:34 | 1551598 SheepDog-One
SheepDog-One's picture

Too bad Robo also told us he was all-in back at DOW 12,700 for the big ride up when the debt ceiling passed.

Thu, 08/11/2011 - 14:38 | 1551614 JW n FL
JW n FL's picture

did you ever notice he always picks the winner after?

he never says I am Long this or short that ahead of time..

just after.

Give Reggie Credit! at least he gives out free info and backs it up! ahead of time!

Tyler to! gives us great info for FREE! ahead of time..

Robo comes in and makes shit up, after the close not before the open.

Thu, 08/11/2011 - 14:42 | 1551632 Stumpy
Stumpy's picture

Did Robo ever passed the turing test?

Thu, 08/11/2011 - 14:45 | 1551639 fuu
fuu's picture

He was saying something earlier about futures surpasing yesterday's highs. His new blood supply went straight to his head.

Thu, 08/11/2011 - 14:06 | 1551534 DaveyJones
DaveyJones's picture

like peeling the pages in 1984

Thu, 08/11/2011 - 16:47 | 1552058 mkkby
mkkby's picture

Excellent, ZH.  One of my "sleeping" friends sent me the CNBC story a few days ago as evidence the selloff was "just politics".  I knew it was BS, but had no data  to counter with... until now.

Thu, 08/11/2011 - 14:01 | 1551517 Strider52
Strider52's picture

Slightly OT: BofA "Online" banking is now OFFLINE.

Thu, 08/11/2011 - 14:21 | 1551557 Takingbets
Takingbets's picture


Bank Run????  Someone from that Bank has called my house everyday for about 2 weeks now. They won't even leave a message telling me who to call back or what they want. I have no accounts with them but they did buy my refinanced mortgaged from Countrywide. Has anyone else here been experiencing these phone calls from them?

Thu, 08/11/2011 - 14:25 | 1551570 TruthInSunshine
TruthInSunshine's picture

A little birdy told me that cash & cash equivalent withdrawals/redemptions are surging.

I would get more specific, but that's all the little birdy told me before flying away into the warm summer wind.

Thu, 08/11/2011 - 14:32 | 1551594 Takingbets
Takingbets's picture

Then their probably calling in the loan wanting payment in full!! Bahahaha!!!

Thu, 08/11/2011 - 14:48 | 1551650 snowball777
snowball777's picture

Could be an offer of a cramdown, if only you'll put some ink on this non-MERS piece of paper...

Thu, 08/11/2011 - 14:25 | 1551571 GotElevenToes
GotElevenToes's picture

I was able to log in.

Thu, 08/11/2011 - 14:41 | 1551627 JW n FL
JW n FL's picture

they are trying to start a bank run! and your truth is not helping their lie!

 

Bank RUN!! on B of A!!

BANK! RUN!!

Hurry! get your gold out of the Bank!! Oops! never mind! LOL

Thu, 08/11/2011 - 14:08 | 1551524 etrader
etrader's picture

The ES TA boxes are bouncing between two 78.6% on the 90min time frames.Normally the (TA) boxes programed to scale sell  the  upper ranges of 76.4 & 88.6 as a continuation entry.

Thu, 08/11/2011 - 14:03 | 1551525 Irish66
Irish66's picture

Can you start a TV program, please!

Thu, 08/11/2011 - 14:09 | 1551533 Cognitive Dissonance
Cognitive Dissonance's picture

Damit Tyler, why can't you leave CNBC's propaganda alone and just enjoy the unicorns and fairy tales?

Enough already. Why didn't I take the blue pill?

Blue

Thu, 08/11/2011 - 14:10 | 1551540 DaveyJones
DaveyJones's picture

perhaps Marcus Bachman can cure you from your fairies addiction  

Thu, 08/11/2011 - 14:22 | 1551559 11b40
11b40's picture

...only if they can get more government assistance for their clinic.

They really have not appreciated all tis new attention very much.

Sunshine is such a lovely dis-infectant.

Thu, 08/11/2011 - 14:20 | 1551556 Dr. Engali
Dr. Engali's picture

Damn that's a lot of blue pills. If your erection lasts for more than four years please see your physician (and maybe a few of his better looking nurses)

Thu, 08/11/2011 - 14:49 | 1551651 snowball777
snowball777's picture

Because you can already get it up?

Thu, 08/11/2011 - 18:03 | 1552321 Hephasteus
Hephasteus's picture

Because the blue pill gives everything you create birth defects.

Thu, 08/11/2011 - 14:17 | 1551535 Caviar Emptor
Caviar Emptor's picture

Yup. Corporate welfare was so rampant and free-wheeling during 2009-11 that major US corporations set all-time records for debt issuance: At a time when too much debt and over-leverage were the root cause of the cirisis!!!!

That and the record secondary stock issuance are the secret behind the "gobs of cash on the balance sheet" at the majors. 

ANd to make the stupendous stupidity complete, the best of it all: That cash is either just sitting and being used to build CEO golden parachutes and/or just being deployed to bolster overseas operations, further undercutting America's economic recovery. 

I consider this a total dereliction of the Fed's fiduciary responsibility to the US Treasury, US Taxpayers, US banks and US people. <----------------THis is how Ron Paul and others could, if they wanted to, break the back of the Federal Reserve with a Congressional investigation. If they don't do it, I doubt their sincerity. 

Thu, 08/11/2011 - 14:37 | 1551597 11b40
11b40's picture

Doubt?  For me, there is no doubt.  All these bozo's, including the "Paul's", have their schtick.  Ron Paul has been playing his for how many terms now?  They play it up to a point, then back off.  There is no intent to seriously challenge the status quo.  Criminals have been tightening their grip on Washington for at least 30 years, and now it is like a vise.

And before the Ron Paul lovers start bashing me, let me just say don't waste your time.  It would be better spent playing with the Obummer lovers in a game of mutual masterbation.  Both parties are corrupt; not a statesman among them.

Thu, 08/11/2011 - 14:38 | 1551619 Caviar Emptor
Caviar Emptor's picture

+10. Ron Paul all but stated in his campaign memo earlier this year that he won't abollish the Fed. Something about not being able to do it all. Yeah right. He might be able to shake them down for a quick profit, though. 

Thu, 08/11/2011 - 16:04 | 1551828 Oh regional Indian
Oh regional Indian's picture

At times like this, one can only wonder how many junks this little Ron Paul Diatribe would have bought.

The good old day.... or not.

Anyways, this surging insider buysing after a couple of years of insider selling, nice deal eh? Sell high, buy low, look good.

Patriots Buying the dip. Hah!

Coming Monday is the day though, I feel it.

ORI

http://aadivaahan.wordpress.com/2011/08/04/many-drafts/ 

Thu, 08/11/2011 - 14:07 | 1551536 fishface
fishface's picture

don' believe any statistic that you haven't forged yourself   ;-)

Thu, 08/11/2011 - 14:12 | 1551545 Cognitive Dissonance
Cognitive Dissonance's picture

The only way you know if a forgery is real is if you forged it yourself.

Brilliant.

Thu, 08/11/2011 - 22:57 | 1553129 IQ 145
IQ 145's picture

!!

Thu, 08/11/2011 - 14:11 | 1551541 bania
bania's picture

execs pressing F5, central bankers pressing CTRL+P, is running the global economy really just a few simple keystrokes?

Thu, 08/11/2011 - 14:17 | 1551550 Stumpy
Stumpy's picture

You're missing one keystroke that I'm not sure who'll actually push: CTRL-ALT-DEL

Thu, 08/11/2011 - 14:37 | 1551613 The Wolf
The Wolf's picture

all done with one hand too... mighty impressive...

Thu, 08/11/2011 - 14:42 | 1551628 Stumpy
Stumpy's picture

I'm sure they programmed the keystrokes to a single big red button for maximum dramatic effect.

Thu, 08/11/2011 - 14:42 | 1551630 Long-John-Silver
Long-John-Silver's picture

Or CTRL-ALT-BREAK

Thu, 08/11/2011 - 14:55 | 1551672 snowball777
snowball777's picture

Ctrl+P until the BSOD!

Thu, 08/11/2011 - 14:12 | 1551544 kito
kito's picture

its all irrelevant anyway. its never been a sure indicator, one way or the other. ONLY jim cramer and laszlo birinyi are sure indicators...oh yeah, and grandpa buffett. he says NO SIGNS OF A RECESSION!!!! NONE, NOT ONE!!!! poor warren, little does he realize that all the staple items his company owns are being bought in record number for purposes of STOCKING UP in preparation for exactly what he says wont happen.

Thu, 08/11/2011 - 14:42 | 1551609 slaughterer
slaughterer's picture

kito, have you noticed how Obama puppets some of Uncle Warren's words during teleprompter hour?  And how networks roll out Warren to prompt the bathrobe brigade to buy some more K and JNJ.

Thu, 08/11/2011 - 14:16 | 1551547 monopoly
monopoly's picture

Reading Zero Hedge....you don't need to listen to the idiot channel. Music works well during the trading day with a news feed.

Thu, 08/11/2011 - 14:16 | 1551549 Cursive
Cursive's picture

Most CEO's manage the stock price, not the company. Form over substance is all that matters in 2011.

Thu, 08/11/2011 - 14:23 | 1551551 RockyRacoon
RockyRacoon's picture

Who was the fella on CBNC extolling all the insider buying -- the most he'd seen since the invention of the steam engine?   Where do they dig up these people?   Some sombitch is lying!

Ah!  Here 'tis:

While panicked investors have recently fled markets in a scale not seen since the last financial crisis, corporate insiders are aggressively buying.

 “Insider buying has accelerated dramatically to its highest level since the market bottom of March 2009,” according to Ben Silverman, Director of Research at InsiderScore, a firm that tracks buying and selling activity for corporate insiders.

According to Silverman, insiders have purchased over $400 million in company shares since July 1, with most of that activity occurring in the last 2 weeks when markets began to nosedive (the S&P fell over 15 percent during that time).

 

Somebody smarter than I will have to parse this crap.

http://www.cnbc.com/id/44074639

Here's the video:

http://video.cnbc.com/gallery/?video=3000038633

Thu, 08/11/2011 - 14:18 | 1551552 dwdollar
dwdollar's picture

Again, the rally today looks clownish.  If Wall Street wants to sucker in retail investors, this is how not to do it.

Thu, 08/11/2011 - 14:22 | 1551558 Stumpy
Stumpy's picture

RIMM (and a lot of others) look pretty healthy today. Healthy like in adrenaline+crack healthy.

Thu, 08/11/2011 - 14:25 | 1551568 SheepDog-One
SheepDog-One's picture

400-600 daily swings only create more loathing.

Thu, 08/11/2011 - 14:28 | 1551575 etrader
etrader's picture

Its not really low level retail their bothered about.

Its fund  redemption notice day tomorrow for Q3 withdarw,They desperately need Dow + 11K & SPX close to 1200 to try and steem a the bleed .

Thu, 08/11/2011 - 14:32 | 1551593 SheepDog-One
SheepDog-One's picture

Sure they have to keep 'tricking' everyone...DOW 11,000 is 'OK', under that its panic. Well good luck to them, theyll need it. Stock markets are TINY compared to the bigger problem that no one cares to buy bonds anymore.

Thu, 08/11/2011 - 14:38 | 1551621 slaughterer
slaughterer's picture

Yup, gotta stick a finger in the dam.

Thu, 08/11/2011 - 14:28 | 1551561 Cult_of_Reason
Cult_of_Reason's picture

To be fair to CNBC, it is not only CNBC.

Here is from CNN:

Insiders Go on Buying Spree

Silverman said insiders have made 35 purchases worth more than $1 million so far this month. The largest is by Harold Simmons, chairman of Titanium Metals (TIE), who spent $8.2 million to buy 600,000 shares of the company on Monday.

 http://money.cnn.com/2011/08/11/markets/insider_trading_bulls/index.htm?...

Thu, 08/11/2011 - 14:35 | 1551600 DonnieD
DonnieD's picture

      Org Chart:

                                                White House

                                               ^

                                           BLS

                                   ^                  ^

                              CNBC               CNN/MSNBC

Thu, 08/11/2011 - 14:38 | 1551618 Cult_of_Reason
Cult_of_Reason's picture


I thought the same – the media gets a list of topics from the White House propaganda department.

Thu, 08/11/2011 - 14:44 | 1551634 slaughterer
slaughterer's picture

Put the Fed in lock with Wall Street above White House and I will buy the poster.  

Thu, 08/11/2011 - 23:01 | 1553149 IQ 145
IQ 145's picture

"Titanium Metals"; wow, that's impressive ! That's pretty funny actually.

Thu, 08/11/2011 - 14:26 | 1551562 GiantWang
GiantWang's picture

It seems the only question that one really needs to answer is whether the financial markets will cease to exist, i.e. completely stop trading.  It seems to be an unthinkable result, if you listen to the talking heads who assume the markets will exist.  The truth, however, is that some compaines will be valuable.  As long as Apple is profitable and has billions in the bank, how can the market cease to exist?

I have physical gold, but the question I struggle with is whether there will be liquidity in gold--whether it will be a form of accepted currency OR whether I will be able to actually cash it out if it becomes too valuable but doesn't replace dollars, euros, Swiss francs, etc.

I mean, what if it becomes impossible to sell gold or use it as medium of exchange?  Again, I do have gold, but I struggle with the thought of taking it to a coin shop and them saying "Sorry, we're not buying.  We're only sellers at these levels."  Then what?

Thu, 08/11/2011 - 14:27 | 1551572 SheepDog-One
SheepDog-One's picture

Hell even in the 'Idiocracy' world there was still 1 company which employed everyone, and everyone owned just that 1 stock 'Brawndo'....fully functioning marketplace!

Thu, 08/11/2011 - 14:28 | 1551573 SheepDog-One
SheepDog-One's picture

Damn ZH busy server...

Thu, 08/11/2011 - 14:31 | 1551590 espirit
espirit's picture

Talk to your barber about accepting "3 or 4 bits" of pre-65 coinage for services rendered. Bet he's pondering how to beat the ponzi himself.

Thu, 08/11/2011 - 14:35 | 1551601 GiantWang
GiantWang's picture

I cut my own hair.

Thu, 08/11/2011 - 22:35 | 1553059 fraud-fed
fraud-fed's picture

Well, in that case you don't need gold, but scissors.

Thu, 08/11/2011 - 14:36 | 1551605 Caviar Emptor
Caviar Emptor's picture

You can cash out to me anytime. There has never, at any time been a shortage of buyers of gold. Even when gold was worth $75, there was a big active international network of dealers, collectors and auctions. All those who bought gold as "collectors" back then are feeling mighty smart. Best, safest investment they could have made. Outpaced stocks  by a lot. 

Thu, 08/11/2011 - 14:52 | 1551662 GiantWang
GiantWang's picture

That's reassuring, Caviar.  I always appreciate your comments.  Most of my gold is not in coins but in Suisse PAMP 1 oz bars.  I've been a big believer in gold for a while, but do have concerns.  Thanks for sharing your view and your "I'm always a buyer" attititude.  Gotta love that!

Thu, 08/11/2011 - 14:37 | 1551610 hunglow
hunglow's picture

I just buy it because it shiny.   What are you talking about.   This is opening up a whole new world.

Thu, 08/11/2011 - 14:37 | 1551611 statlawyer
statlawyer's picture

I took some of my gold/silver bullion into a local coin shop here. They're 100% willing to take me out of my coins at spot prices (no commission). Of course I didn't sell. This is about a week ago. I went online and bought more.

Thu, 08/11/2011 - 14:44 | 1551635 The Wolf
The Wolf's picture

Krugers, Maples, Eagles...some are offering spot + $10/$20 for these popular items...

 

 

Thu, 08/11/2011 - 14:27 | 1551574 Dr. Engali
Dr. Engali's picture

I turned on CNBC for like two minutes today and they said that insiders were buying hand over fist ,then they had Trump on with all his wisdom. I just wanted to scream at their lying fucking propaganda. I decided to turn it off before I shot my TV with a 9mm. Then proceeded to go downstairs and get some real news from the hedge.

I think I need some professional help :)

Thu, 08/11/2011 - 14:30 | 1551582 SheepDog-One
SheepDog-One's picture

I turned off all TV media long ago, they can chatter to themselves I dont need to hear their crap.

Thu, 08/11/2011 - 14:35 | 1551599 espirit
espirit's picture

Same here SD-1.  No need for mis or dis-information. Will leave that for the sheeple.

Thu, 08/11/2011 - 15:30 | 1551753 slewie the pi-rat
slewie the pi-rat's picture

Dr e

next time shoot first, go downstairs later!

Thu, 08/11/2011 - 16:57 | 1552086 Diogenes
Diogenes's picture

Very wise, you should not try to throw the TV out the window by yourself. You could hurt your back.

Thu, 08/11/2011 - 23:08 | 1553162 TruthInSunshine
TruthInSunshine's picture

No propaganda box here for 1 1/2 years, either. And it was a decision made freely, not by necessity, and it ranks in the top 3 things I've done on the past several years.

The collusion between government and the MSM in Amerikranski is so obvious, only a blind troglodyte wouldn't recognize it.

(How many blind troglodytes watch television?)

Thu, 08/11/2011 - 14:29 | 1551583 bania
bania's picture

" Tradition" getting the smackdown today

Thu, 08/11/2011 - 14:37 | 1551608 Dr. Engali
Dr. Engali's picture

Good I hope it gets smacked down about $150 more. I want to buy more and I want it out of the news.

Thu, 08/11/2011 - 16:38 | 1552027 citta vritti
citta vritti's picture

exactly

Thu, 08/11/2011 - 14:31 | 1551591 citrine
citrine's picture

Tyler,

You seem to be reading my mind: I just asked myself this "insider-buying" question!

Thu, 08/11/2011 - 14:33 | 1551592 etrader
etrader's picture

The TA bots are selling  a Triangle pattern (ES) so we'll see if Robo pops his head up to say buy....

Thu, 08/11/2011 - 14:45 | 1551638 slaughterer
slaughterer's picture

Its OK, I said BUY this morning.  Nobody around here listened.  

Thu, 08/11/2011 - 23:21 | 1553187 IQ 145
IQ 145's picture

Interview with Marc Faber last Friday; "What happens next,?" Answer, a rally. Nobody ever listens. He also said; no more new highs this year; which, of course, means it doesn't meet the criteria for a bull-market. But it looks like the reflex rally is getting it's legs under it. Have to be sure and sell "too early", as JP Morgan once said.

Thu, 08/11/2011 - 14:47 | 1551646 Seasmoke
Seasmoke's picture

seriously, this may some of the biggest BS Spin ever from these pumping clowns

Thu, 08/11/2011 - 14:59 | 1551684 Manbearpig
Manbearpig's picture

Spit out my coffee when I read the FoxConn bake sale line...bravo

Thu, 08/11/2011 - 15:39 | 1551773 slewie the pi-rat
slewie the pi-rat's picture

thx for this, t.d.

i was wondering about this yesterday:  when will tyler put up something about insider buying going ape-shit, as opposed to many mony moons of insider selling?

they are bunko and tyler is the deee-bunker!

Thu, 08/11/2011 - 15:55 | 1551811 jbc77
jbc77's picture

I actually had CNBC on when they discussed the "massive" insider purchases going on. I did a double take and then laughed out loud because I knew right away as a daily zerohedge reader that CEO's have been massively dumping, not buying.

I work in the financial industry so we have TV's playing CNBC all over the office. It's to the point where I've turned the volume off on most os the sets. The lies and BS on that channel are just unreal. Truly is the lemmings sheep like financial news but it disgusts me to here theym lie all day long.

Thu, 08/11/2011 - 17:04 | 1552107 PulauHantu29
PulauHantu29's picture

$20 Million? ...................LMAO

GS Bonuses last year were over $15 Billions I read.

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nameman's picture

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