Insider Trading and The Stock Market
A number of researchers have studied the relationship between insider trading activities and the stock market performance. In this note, we present our research results as shown in the following charts. We calculate the weekly unique insider buyers and plot it against the Dow Jones Industry Average.
In November 2008, we saw insiders finally showed strong interest in buying their company shares as Dow crashed below 8000. In the week of November 12 to November 18, 1300 unique insiders bought shares. 1700 unique insiders bought shares in the week of November 19 to November 25. Again in March 2009, insiders bought aggressively when the market plunged to 16 year low.