Investors looking to glean tips by analyzing the stocks insiders are buying may have had some difficulty recently: A lot of the insiders have disappeared.
Insiders - top executives, directors and large stockholders - are in the best position to judge whether the fortunes of their respective companies are looking bright or dismal. When they like what they see, they buy their company's shares - when they don't, they sell.
These in-the-know investors typically load up on stock when shares are cheap. They bought heavily during the market lows of 1987, 1998 and 2008-2009. They also continued purchases in 2010 after the market had its worst August performance since 2001.
This year had been no different - until now.
"They've stopped buying," Charles Biderman, chief executive officer of investment research firm TrimTabs, told MarketWatch. "Insiders aren't buying this rally. It looks to me that insiders are uncertain as to what's happening."
There are still some stocks insiders favor - but a frighteningly fewer number than just last month.