The Insiders Fund Not So Daily Digest

Insider Buying Week 5-19-23 If you want to play a game of chicken- Tyson Insiders are Buying

by

No one really believes the U.S. will default on the debt.  The least of which are these insiders stepping up to buy their company’s stock last week.  If we’re talking a game of chicken, I say look at what Tyson Foods insiders are doing.  Five insiders took advantage of the steep share price drop on Q1 earnings disappointment.  Albemarle insiders continue to bet on the lithium economy. If you’re inclined to bet on default, take a look at the PRA Group’s earnings disaster and the new CEO purchase.  Debt collection could be a hot new growth market. You can be … Read more

When it comes to Financial Advice Bard and Chatbot GPT are just a new twist on the Old Shell Game

by

All the buzz and the action are about Chatbot GPT, Bard, and large language model generative text and imaging capabilities.  I’ve heard this hailed as the most important invention since electricity and fire. I want to call a giant timeout and bubble alert.  As you know, as a first step in my analytic process, I assiduously track insider buying and selling using paid services like Secform4.com to scrape free information off the SEC Edgar website. I try to fathom what the insider sees that Mr. Market may be missing.  So I asked Bard (Google’s beta AI offering) what insider filings … Read more

Insider Buying Week 5-12-23 Prelude to Something but What?

by

Insiders are coming out in force to buy regional and community banks.  Normally significant insider buys are met with a predictable market response, a positive bounce between 3%-5%. This is not happening.  There is no urgency, as the stocks, for the most part, are lower than when the “informed investor” purchased the shares.  I like to believe that no one knows more about the business than the people running it, but banks may be a glaring exception to my dogma.  First of all, banks’ balance sheets are complicated and notoriously obtuse.   2008 should serve as an indelible reminder of that. … Read more

Insider Buying Week 5-5-23 Banking Blood Bath is it time to Buy?

by

Insiders came out to play last week. It was not pretty, but insiders are bottom fishers, as a rule. They buy in force when prices are down when they perceive a bottom.  Regional bank insiders were all over the field scooping up prices that haven’t been seen since the Pandemic lows. Unfortunately, most of it was in regional bank stocks. Bank stocks are notoriously difficult to understand. First of all, they are highly leveraged, between 5-10% Tier 1 capital ratios which is the ratio of a bank’s core tier 1 capital—its equity capital and disclosed reserves—to its total risk-weighted assets.  Usually, that … Read more

Insider Buying Week 4-21-23 Lithium Stocks Crash, Director buys more Lockheed Martin, and the Curious Case of Domo

by

Reuter’s headline news Friday that Chile is nationalizing the vast lithium deposits sent Albermarle and the rest of the lithium economy into a tailspin. More than half of the estimated global lithium resources are located in the salt flats of Bolivia, Chile, and Argentina, much of that in Bolivia.   For the time being, lithium stocks are uninvestable. Think Casear Chavez and Chevron’s disastrous write-offs in Venezuela.  It will be interesting to see if there is any insider buying in the world’s largest public producer, Albermarle.  Perception usually trumps facts when it comes to stock market investing.  The repercussions of this … Read more

Insider Buying Week 4-14-23 The Fed stopped hiking rates even though they won’t acknowledge that.

by

There was next to nothing to write about regarding insider activity last week. We are in the heart of darkness regarding insider activity. This is how I describe the quarterly blackout period before corporate earnings are released.  Insiders seem to be as gloomy as all the market pundits. They might not be paying much attention, but the market, as measured by the S&P 500, is up over 8% YTD.   Hopefully, we have something clever to say about that in our 1st Quarter Partner letter.  It’s up on our website at Partner Letters. The world changed on March 10th when the … Read more

Bye Bye Jay Time for Another Chair Insider Buying Week 3-24-23

by

We are deep in the darkness, the earnings blackout period in which corporate insiders are restricted from buying their own shares. It’s a perfect time for short sellers to prey on the frazzled nerves of investors that just experienced their first bank run since the Great Financial Recession of 2008. This time the run wasn’t caused by Wall Street and banks that sold liars loans to uncreditworthy customers but instead by the monetary policy of the Federal Reserve itself. Jay Powell left interest rates at zero far too long and raised them far too fast. He failed at running the … Read more

One way this is not like 2008, Insiders are NOT Buying -Insider Buying Week 3-10-23

by

This is LIKE 2008, contrary to what you may have heard about the recent Silicon Valley Bank failure.   Banks either don’t want to pay competitive deposit rates or can’t.  Competing with Fed Chairman Powel’s ~5%  treasuries is hard. Actually no banks can compete with it. Vast sums are being withdrawn from the banking system. Ironically the stock market is on the only place you will be able to compete with the yield crisis that the Fed is precipitating.  Many solid companies are paying good dividends with the likely prospect of raising them.  So tell me, how is this not like … Read more

Hedge Fund Analysts Class 2nd Semester- a Word about Attendance

by

I have very flexible rules about work and participation in the Insiders Intern Analyst program. Still, one of them is non-negotiable, and I make that clear in the interview process. The main question I asked everyone in the intern interview process- is whether you will give it the time it deserves, not just for yourself but out of respect for my time and the time of our fellow interns. If you can’t make a meeting, that’s understandable, but you should put forth and share work or insight of some kind to make up for your absence. it’s assumed you are … Read more

The Fed has a Hammer but needs a Scalpel Insider Buying Week 2-24-23

by

It’s a commonly held view amongst market strategists that the Fed follows interest rates, not determines them. You don’t have to look very far to see plenty of evidence of that.  It’s a quiet conspiracy amongst talking heads and futures markets that economic events and statistics are immediately reflected in real-time price action in the bond markets, dot plots, and other dynamic markets. The Fed will often talk up its view, and by the time they do take some action on rates, it’s hardly a surprise. This is, of course, by design. The Powell Fed believes in transparency and no … Read more