How To Make Money In The Stock Market From Insider Trading!
Stock market investing can be tougher than tough! You work very hard and have done so for years and years to save up money for your retirement. Make just one or two wrong decisions about how you invest that money in the stock market, and all your hard work can evaporate right in front of your eyes leaving you with absolutely nothing. That should be a terrifying thought to you!
So what can we do to make sure that our stock market portfolio doesn’t drop out of the sky? The answer is through insider trading!
I hope I’ve got your attention but unfortunately I have to break it to you, I’m not talking about the kind of insider trading that you probably think I’m talking about. No, I’m not talking about any kind of Martha Stewart illegal insider trading, I’m talking about watching what insiders of a particular company invest in themselves. Today I am going to show you exactly how to do that in this article.
Watching how corporate insider purchase or sell stock is much easier than you may think and there’s nothing illegal about it, unlike that other kind of insider trading you probably thought I was talking about.
When an insider from a corporation buys or sells stock you should follow what they’ve done. The reason why is because they have the kind of information about the company’s future that you may not be able to get even if you have carefully read that company’s financial statements. Besides, those executives lives, their careers, and their own wealth are usually tied in to these very investments because they get paid, especially in bonuses, with company stock a lot of the time. Because of this they are very cautious and are not often wrong.
Usually speaking, when three or more insiders of the company are buying… that’s a pretty good sign that you should buy as well. It doesn’t matter usually how much they’re buying, even if it’s just a few hundred shares that’s still a pretty good indicator.
One thing to keep in mind though is that many times insiders buy stock for very long-term purposes. They feel that the company has a very long-term stability possibility. That doesn’t necessarily mean that next year the stock is going to rise, but that over the years to come there’s a good chance that it will rise. So this isn’t necessarily a way to find a quick kill or a get rich quick type of trade.
Company insiders have to file forms with the SEC which is the securities and exchange commission. You can look up these forms right off of the SEC website for any company within your investment portfolio. You can do this quickly easily, and for free so there is no reason not to do this.
One thing to keep in mind, insiders don’t have to report to the SEC immediately, there is a time lapse of weeks or months before they have to file. So keep that in mind.