Research for the last 60 years shows that insiders are consistently the most informed of all traders in the equities market

Insiders buy their own firm's stock before the price goes up and sell before it goes down, beating the market by about 5% each time. They achieve a return that is triple the market return (on average, on a one-month horizon). ¹

In contrast, nearly 90% of actively managed equity funds fail to beat the market over 10 years. ²

That's why if you are an active trader, money manager, or personal investor who makes significant investment decisions on a 2-to-12 month time horizon, you need to know what signals insiders are sending.

In collaboration with Professor H. Nejat Seyhun of the University of Michigan Ross School of Business , the Insider Sentiment Dashboard utilizes more than 40 years of academic research to bring you insights from the world of insider transactions.

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An insider transactions table available to subscribers of InsiderSentiment.com

Above: Elon Musk announced a $20 billion sale of Tesla shares as the stock went above $400. That was a historic peak in the stock price.

Below: Jamie Dimon purchased $25 million of JPM after the price dipped below $50. It has not traded that low since.

Over the last 10 years, a portfolio incorporating signals from the Insider Sentiment Tracker could have significantly improved the reward-to-risk ratio compared to just passively investing in a Russell 2000 ETF (red line).

By buying the Russell 2000 when insiders were also buying, the return went from 67% to 130% while the risk was reduced by over 40% (blue line).

But buying the Russell 2000 when insiders were selling was a sure-fire way of crushing returns (green line).

Graph showing the Insider Transactions Tracker versus the Russell 2000 Index

Full write up of this calculation available on the blog

During the COVID period, insider "buy" signals preceded large increases in the stock market. Later, insider "sell" signals marked the top of the 2021 bull run.

In this time of high uncertainty, these signals would have allowed you to buy in March 2020 before the rise and sell before the fall in 2022.

Here you can see that when the stock market fell in March 2020 due to fear, insiders were not scared.

In fact, they started buying their own firms' stock in record numbers, signaling that a rebound was imminent. They were proven correct as the stock market started to rise rapidly just the following month.

How valuable would this forward-looking signal have been to you at the time?

What you will get in the Insider Sentiment Dashboard

The tabs of graphs available to subscribers of insidersentiment.com

Our Flagship Insider Sentiment Tracker

Daily updated aggregated summaries showing insider sentiment for various sectors, firm momentum (trend), and investing styles (value, growth or blend), plus firm size.

A graph showing the insider selling for Morningstar, Inc. (Nasdaq: MORN)

Firm-level Insider Transactions

Viewing insider transactions together with stock prices helps you see whether insider transactions are opportunistic or merely routine, such as being related to a 10b5-1 plan

High-Signal Insider Transactions

Find the most informative trades by transaction type each week.

A company screening table available to subscribers of insidersentiment.com

Company Screenings

Find companies based on fundamental and technical indicators, plus insider transaction activity.

Professor H. Nejat Seyhun has been a leading expert on insider trading for 40+ years.

His work on insider options backdating helped uncover one of the largest corporate scandals in recent time.

He regularly appears in leading publications such as the Wall Street Journal, The New York Times, MarketWatch and others to give his opinion on insider sentiment.

Standard Plan

View access to both aggregated and firm-specific data and all analyses

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$250

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Pro Plan

Everything in Standard plus unlimited data downloads

$4,225

/year

Purchase

Custom Plan

Everything in the Pro plan plus custom alerts and data to fit your needs

Customized daily alerts before market open based on your investment strategy. Alerts based on any EDGAR filing, including Form 4, 8-K, EX-2.1, 13-D, 13-F, and 13-G

Research for the last 60 years shows that insiders are consistently the most informed of all traders in the equities market

Insiders buy their own firm's stock before the price goes up and sell before it goes down, beating the market by about 5% each time. They achieve a return that is triple the market return (on average, on a one-month horizon). ¹

In contrast, nearly 90% of actively managed equity funds fail to beat the market over 10 years. ²

Over the last 10 years, a portfolio incorporating signals from the Insider Sentiment Tracker could have significantly improved the reward-to-risk ratio compared to just passively investing in a Russell 2000 ETF (red line).

During the COVID period, insider "buy" signals preceded large increases in the stock market. Later, insider "sell" signals marked the top of the 2021 bull run.

It is not enough to just know how much insiders are buying or selling. You need to know how to interpret insiders' actions and how they play into the broader macroeconomic picture.