Corporate Insiders Have Stopped Stocking Up On Stocks

Don't look now, but one leading indicator of stock market price trends is looking a little down in the mouth. In periods of relative stock market stability, corporate insiders normally conclude twice as many sales of their company's stock as purchases--that is, the ratio of sell to buy orders by corporate insiders runs about 2 or 2.25 to 1. In the final quarter of last year, however, the insider ratio was about 0.5, reports Vickers Stock Research Corp., which means that insiders' purchases were outnumbering their sales by about 2 to 1. That surge in insider buying correctly anticipated the stock market rally that occurred in the first quarter of this year.

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