Insider stock transactions – the buying and selling of stock by corporate “insiders” – won’t tell you where the overall stock market is headed. But the analysis of this type of legal insider trading can be a handy indicator when it comes to making buy and sell decisions on individual stocks.
In fact, by watching insider transactions, investors can actually gain an edge in certain situations, an academic researcher and leading expert on insider transactions said in an interview with Barron’s earlier this month.