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HomeWhat Are Insiders Doing, or Pump and Dump?
Posted by Larry Doyle on June 1st, 2010 12:03 PM |
Who truly knows more about a company’s prospects than the executives running the operation? These executives, commonly referred to as insiders, are privy to sensitive, non-public information. Insiders are subject to severe restrictions in how they handle this information, and most importantly in how they manage their own finances.
Insiders selling company stock is not always an indication that the company is having problems. Insiders manage their own finances and will sell for a variety of reasons, especially for tax purposes. That said, monitoring insider activity is always prudent. Are there trends? Is activity heavily skewed in one direction or another? Is there a major inconsistency between insider activity and analyst recommendations? (more…)
