Wednesday, November 3, 2010

Sell Signal

Normally, a ratio of over 20-to-1 is seen as a bearish sign. A ratio of under 12-to-1 is bullish.


“Last time we had an insider sales ratio of over 30 times was in April, just before the markets went kaput for awhile. The so-called ‘Flash Crash.’ Then the ratio went under 12 for long stretches during June through September. During this time, the market has generally been rising.

“In October, we had a spike in insider selling. This indicates that at least as far as insiders go, stocks look fully priced.”

So... beware. Or at least be wary of what you buy.

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