Hi Streina, I used to worry about insider sales too. Then one day I just happened to look at insider trading for Amazon. There are hundreds, and hundreds, and hundreds, and hundred, of insider sales, and every quarter, back to when Amazon was a tenth of the price it is now. The insiders were always wrong if you think of them as forecasting.
One way that I think of it is that the majority of insider sales are simply employees cashing their paycheck.
Furthermore, when you think of how high of a % of their wealth some of these people may have in the company they work for, it can also be thought of as a little rebalancing also
It’s always about the number of directors, their status, the timing, the pattern and above all the percentages. They may add up to nothing, or something to take into account.
Incidentally, P. Lynch was quite wrong to say directors only buy for one reason etc. I have often seen chairmen ‘step up to the plate’ in hopeless adversity, hoping somehow to engender confidence!
I will be back after Christmas. Best wishes to you all and thank you Saul.
Hi Streina, I used to worry about insider sales too. Then one day I just happened to look at insider trading for Amazon. There are hundreds, and hundreds, and hundreds, and hundred, of insider sales, and every quarter, back to when Amazon was a tenth of the price it is now. The insiders were always wrong if you think of them as forecasting.