As financial markets continue to swing violently as volatility remains elevated, making reasonable investing decisions and this environment can seem impossible to do today. This is a trader’s market, and while volatility can indeed be a trader’s best friend, the same volatility happens to be the worst enemy of conservative long term investors right now.
For traders seeking information about where a company's stock price may be headed in the very short term, following the money as it pertains to company insiders is certainly one way to go.
Smart Money tends to bounce around in these kinds of markets, and those who think they may know something you don't know may indeed be willing to cash out, even as stock prices plummet, a warning sign for all investors. I, like many investors and traders, keep a close eye on insider selling activity for this reason.
As always, please remember to consult with a certified financial advisor and do your own research before making investing decisions.
Insider buying or selling activity is not necessarily indicative of future performance of a given company stock price and insiders regularly buy or sell positions and companies they manage for reasons other than expectations of future performance. Analyzing insider transactions in a given stock is one tool of many to glean pertinent information to assist an investment decision-making.
Invest wisely, my friends.
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