Trading Ideas

Insider Buying Week 12-15-23 Glad to See some Big Names and Big Dollars Returning to the Insider Buying Game

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While some stocks like the Magnificent Seven have had a phenomenal comeback year, many, many companies are depressed in value. We have no shortage of compelling investment ideas, but getting people to invest when values are low is the opposite of human nature. Paying particular attention to significant insider buying is one way to force that discipline on yourself. When not painting the tape or participating in required corporate ownership requirements, insiders are historically value buyers.  This week, we highlight what we think are notable buys. Although we pay attention to selling, we don’t write about this far more nuanced … Read more

Insider Buying Week 12-01-23 AI will Improve everything but the Tesla pickup truck

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FOMO  (fear of missing out in a year when the S&P is up over 20%) is in full swing. One thing not making the headlines is the market is essentially where it was two years ago, with investors on a roller coaster ride.  AI will improve everything except the Tesla pickup, and gasoline is the cheapest at the pump in years, even as the world seems to be throwing in the towel on preventing climate change. All that ESG and green talk seems to be more expensive than anyone wants to pay for. The magnificent seven took the week off … Read more

Insider Buying Week 11-17-23 Few Buyers Lots of Sellers

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   There are a few insider buys this week. As usual, there are a lot of sellers.    Name: Roland D Diggelmann Position: Director Transaction Date: 2023-11-13  Shares Bought: 315 Average Price Paid: $1,026.54 Cost: $323,360 Company: Mettler Toledo International Inc (MTD) Mettler Toledo International Inc. is a global leader in precision instrumentation and services. The company has strong leadership positions in most businesses and worldwide market leadership. The company is known as an innovator, and solutions are vital in key R&D, quality control, and manufacturing processes for customers in various industries, including life sciences, food, and chemicals. The sales … Read more

Insider Buying Week 11-03-23 Insider Buying offers Clues as to where Bargains might Await

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The difference between the 10-year Treasury Bond yield and the S&P 500 dividend yield is the largest it’s been since 2007.  The spread between interest earned on Treasury Bills and dividends reached levels not seen in 40 years. ~5% money market rates and an S&P 500 dividend yield of 1.52% cannot coexist indefinitely. This is not a condition for equilibrium. Something must give. Great amounts of money will be made in getting this right. In the immortal words of Dylan, the poet laureate, “Something is happening here; But you don’t know what it is.” The market changed its narrative last week from higher for longer … Read more

Insider Buying Week 10-20-23 – Next week may be the spookiest in some time.

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So far, 3rd quarter earnings haven’t done anything to dispel the gloom. The S&P 500 lost 2.39% last week. That’s hardly a surprise. What’s a bigger surprise is that the market is hanging on to any gains at all this year. We’ll find out how lopsided investment returns are when the tech giants report earnings this coming week. The entire S&P 500 now hangs on Microsoft, Google, Alphabet, Meta, and Amazon as the broader market is a veritable dumpster fire. It seems like a tall order that investors continue to bid these stocks higher just because they have a lot … Read more

Insider Buying Week 10-06-23 Israel at War while the Fed Reserve Fights the American Consumer and Stock Market

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The market reached deeply technically oversold conditions.  Bullish divergence RSI was signaling a reversal. I would have said this reversal has room to run, but the war in Israel may reverse whatever animal spirits are forming. Give Peace a Chance looks like a nostalgic idea, with the axis of evil combined with Iran, Russia, and China financing it through the purchase of oil.  Why the U.S. doesn’t stop the transit of Iranian oil through the Hormuz straits is a mystery considering there have been dozens of provocative actions by Iran that have been stymied only by the U.S Navy coming … Read more

Insider Buying Week 9-29-23 as the Bar for Insider Buying is Rising

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You can’t say you were not warned. I’ve been clear with my thoughts about the misguided policy of the Federal Reserve raising rates to thwart inflation. Chairman Powell morphed chameleon-like into a new version of Paul Volker, a Paul Volker light at Jackson Hole in August 2022. He set the global economy on a tightening course that is academically correct but economically wrong. Reference this post from Insider Buying Week 8-26-22 Jerome Powell Debuts at Jackson Hole as “ChuckyIt was a blood-red day on the map of the market. As I wrote then, it’s true now. We have spent all … Read more

Insider Buying Week 9-22-23 The Setup Reminds me of the October Crash of 1987

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  This week’s blog post is especially brief. It’s not because brevity is the soul of wit, either. Insiders are in the third-quarter blackout window; even if they wanted to buy, most cannot. I doubt there would be much buying anyway at these levels as the news is gloomy, and there is clearly a draught in animal spirits.  The other reason is that I ran out of time. I went to San Diego for the weekend to attend the Miramar Air Show, the largest military airshow in the country.  My business excuse was to observe the Valkyrie stealthy drone firsthand … Read more

The Beauty Health Co

Insider Buying -Interest rates may have peaked but the damage to earnings is just beginning

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Market gains are muted, and traders are quick to snatch profits.  Rallies are reversed almost daily as market direction is indecisive.  By many measures, bargains in the stock market are hard to come by.  The earnings yield of the S&P 500 is 3.98%, and the P.E. is historically on the low side.  Earnings surprises are met with a sell-the-news trading mentality.  The economy is showing signs of stalling, yet the Fed has made it clear, that if rate hikes are near the end of the cycle, high-interest rates will be here for quite a while.  10% car loans and 7.3% … Read more

Notes from Enercom Denver August 2023- No Dessert at Lunch this Year

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Last August, I wrote thoughts on Denver Enercom 2022 Let The Good Times Roll.  Enercom is the annual oil and gas conference in Denver in August that brings together hydrocarbon energy producers and investors, analysts, vendors, suppliers, and groups generally economically tied to the industry.  The conference is free for me to attend, as I imagine it is for most. The people that pay get up on the stage and have something to say. I’ve been going to it for years, but this might be the last.  The companies presented are fewer, smaller, and more speculative. Attendance has always had … Read more

Insider Buying Week 8-11-23 and the Summer Doldrums

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We are not surprised by the momentum of the oil and gas sector, as it was only a matter of time before its strong fundamentals collided with short sellers and skeptical money managers. We wrote last week about the strong signals from Exxon’s latest quarterly earnings. Activist Exxon board member Jerry Ubben’s purchase of Exxon may have been the biggest act of his illustrious career.  CEO Darren Woods is transforming  Exxon into a juggernaut of earnings  AND the undisputed heavyweight of both hydrocarbons, renewables, and carbon capture. Its stands to dominate all.  According to Woods, there is no reason for … Read more

Insider Buying Week 8-04-23 Hydrocarbons Make the Modern World Modern

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Oil and gas have been the best-performing sector in the market for the last couple of weeks. There is much talk about an oil surplus, and economic weakness in China, the world’s largest petroleum consumer.  Analysts are often too deep in the woods to see the trees.  It is true that Opec et al. Russia fiddle with the supply of oil in an attempt to manipulate the price, but it is equally true that every industrialized economy attempts to influence the price, supply, and consumption of the world’s most important commodity. For example, The U.S. sold off its Strategic Petroleum … Read more

Insider Buying Week 7-28-23 Euphoria has Begun

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Last week pretty much heralded the end of the bear market.  True, long-lasting bull markets start with a plethora of insider buying. That’s obviously not happening.  I’m trying to figure out what that means.  Every significant market correction ended with a near explosion of the insider buying versus selling ratio going vertical. Right now, insiders are cautious. I think we should be too.  That doesn’t mean there won’t be anomalies.     Name: John H Stone Position: President and CEO Transaction Date: 2023-07-27  Shares Bought: 17,500 Average Price Paid: $116.62 Cost: $2,040,892 Company: Allegion plc (ALLE) Allegion plc, a leading … Read more

Insider Buying Week 6-30-23-The Nasdaq 100 notched its best-ever first half of a year.

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The Nasdaq 100 notched its best-ever first half of a year.  In a classic reversion to the mean, the worst-performing sector usually becomes one of the best-performing ones.  The Nasdaq 100 will need to rise nearly another 200 points to recoup the amount lost since December of 2021.   I doubt if it could have recouped these losses this fast, though, without the market hype about generative AI. Nasdaq had been on an unsustainable tear since the beginning of the 2020 work-from-home hyper stimulus-infused Pandemic.  I have no idea how long this can last, but I can say with reasonable confidence … Read more

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

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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

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

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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

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

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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

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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

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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

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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

Insider Buying Week 2-10-23

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When I started developing the Insiders Fund’s strategy in 2001, I knew I would miss out on some of the all-time greatest investments since founders of disruptive companies are loaded to the gills with their own company’s stock and don’t need to buy more of it. That was all right with me if could forgo this “pot of gold” and by doing so avoid the scams, frauds, and charlatans that populate the financial world.  This week we have the rare insider buy at a potential pot of gold, Vicarious Surgical, a true med tech disruptor.   Name: John Morici Position: … Read more

Stock market Pundit Mike Wilson gets Egged- Insider Buying Week Ending 2-3-23

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Morgan Stanley’s head of equity strategist Mike Lee stood out from the herd last year calling the market sell-off in 2022. Not only did he get it right, but he also stuck with his guns and didn’t back down during the many gut-wrenching bear market rallies last year.  He’s been bearish since the market rally last Fall and has doubled down on what is turning out to be one of the most embarrassingly bad and brazen market calls I’ve heard in some time. He’s not alone, though. Almost every pundit I read or listen to, says the same thing. Don’t … Read more

Animal Spirits and the Doomsday Clock are on a Collision Course-Insider Buying Week 1-27-23

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Not one of the many podcasts and pundits I listen to predicted a rally of 16% magnitude since the October lows. The January rally to date has been raw animal spirts. Obviously, this can’t keep going with the Fed dangling 5% risk-free returns out there.   Insider buying is incredibly scarce, even considering the seasonal effects of quarterly earnings blackouts.  This is what interested me last week in the thinly populated world of insider buying. The most exciting event is the new bubble forming around AI, capped off by Microsoft’s $10 billion in investment in OpenAi’s and  their overnight ubiquitous quantum … Read more

Is Rivian $RIVN a Good Buy? They make 10,000 cars a month like Tesla $TSLA did in 2015

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Dir Flatley bought 40,000 shares of Rivian back last May at $29.31 per share. The CEO Robert Scaringe did the same, buying 41,000 shares at $25.78. Today it closed up 11.8% at $18.15. Rivian has a market cap of $14.9 billion dollars, but it only has an enterprise value of around $3.4 Billion when you factor in the cash on hand. Rivian announced it produced 10,020 vehicles in Q4. Tesla achieved that in the 1st quarter of 2015.  Unlike Tesla,  Rivian has a wildly popular EV pickup ready now.  How long it takes to get one and the delivery price … Read more

Notable CrowdStrike $CRWD Insider Buy Week 12-30-22

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Following insider behavior closely was an excellent way to avoid some of the technology investing disasters in 2022.  Darlings of the past decade—namely technology stocks—were hammered last year. The S&P 500 and Nasdaq plunged into a bear market as the Federal Reserve decided it didn’t want its legacy to be runaway inflation.  Their record interest rate hikes crushed demand and continues to dampen interest for risk-sensitive assets. We’re now deep in the throes of the 4th quarter earnings blackout when insiders are restricted from taking advantage of these reduced prices.  Even if we weren’t, I don’t think there would be … Read more

Insider Buying Week 12-16-22 CRONOS Up in Smoke?

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The Biden administration may be the savviest market timer on or off Wall Street this year.  The widely scoffed-at and criticized announcement on March 31 stated that the administration would start selling oil from the nation’s strategic petroleum reserves.  It sounded like a cheap trick to influence voters upset about high prices at the pump for the Midterm elections. At the time, the price of a barrel of West Texas Intermediate Crude hovered around  $98 per barrel and has gotten as high as $110.  Friday’s close of $74.50 represents a short seller’s return of over 35% in less than nine … Read more

‘s Blockbuster Short Sale Trade

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The Biden administration may be the savviest market timer on or off Wall Street this year.  The widely scoffed-at and criticized announcement on March 31 stated that the administration would start selling oil from the nation’s strategic petroleum reserves.  It sounded like a cheap trick to influence voters upset about high prices at the pump for the Midterm elections. At the time, the price of a barrel of West Texas Intermediate Crude hovered around  $95 per barrel and has gotten as high as $110.  Friday’s close of $79.73 represents a short seller’s return of over 30% in less than nine … Read more

Something for Everyone Insider Buying Week 12-2-22

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Learn How You Can Become an Insider Too – Click Here For the first time in over a decade, fixed-income investors are enjoying reasonable returns.  The Fed seems intent on keeping rates high for longer than stock market participants might like, but it hasn’t yet done great damage to the hopes and fortunes of equity owners. What I mean by this is to look at the 10-year Treasury, the benchmark index which stock market returns are said to compete with.  The long-run average annual return of the stock market average is 7%-9% per annum. That still provides a measure of … Read more

Insider Buying Week 11-25-22 Cronos Group up in Smoke

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Learn How You Can Become an Insider Too – Click Here This is the best time of year to be invested, statistically speaking. Why that is, no one really knows for sure.  Perhaps it has something to do with animal spirits, people feeling good about themselves, others, who knows?  Animal spirits can’t be overrated.  People are more likely to bet on the future when they feel good about the present. This statistical stock market tailwind isn’t as strong in bear markets, though. The future for most people is just the day after tomorrow and doesn’t look that different than today.  … Read more

A Few Good Calls- Not Many More Prescient than Our April 21, 2022 post on Coinbase IPO

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We’ve had a few good calls and timely posts, but few more prescient than the April 21, 2021 If Bitcoin is a house of cards, then Coinbase is the clarion bell on the top of the house about to crumble post https://insomniachedge.com/2021/04/coinbase-if-bitcoin-is-a-house-of-cards-then-coin-is-the-clarion-bell-on-top-of-the-house-about-to-crumble/ Insider selling is not as good a predictor of future stock performance as insider buying, but when the selling comes in droves, I call it “rats leaving the ship.” That’s precisely what the Coinbase IPO was, rats leaving the ship What amazes me is that crypto enthusiasts clamor for regulation as the panacea for their woes. I think … Read more

"The insomniac hedge fund guy" is a moniker Harvey Sax, the portfolio manager for The Insiders Fund has used from time to time on email, blog , and social media posts. While Mr. Sax is the portfolio manager of The Insiders Fund, these posts are not communications from, nor endorsed by, Alpha Wealth Funds, LLC or any of its managed funds. References to Alpha Wealth Funds or its affiliates are for identification only and do not imply sponsorship or approval. All registered trademarks herein are the property of their respective owners.

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