Insider Trading Pages

How to Use the Insiders’ Hot Stocks Screener

Do you know who has the best shot at making an accurate judgment of a company’s future trajectory? That’s right! It’s the company’s corporate insiders themselves. These insiders are in the know about the company’s latest developments and can most accurately foretell if a company is heading for success or failure. As an investor, following the trading activities of these insiders can prove to be highly beneficial when searching for new investment ideas. 

Corporate insiders are C-level Executives, Directors, or 10% Shareholders of a company. Because of their insider knowledge, insiders are required to report their buy/sell trades of the company’s shares to the Securities and Exchange Commission (SEC) within two working days. While these documents (Form 4) are publicly available, it can be quite tedious for an average investor to keep track of them. TipRanks makes this easier for you by scanning all the publicly available documents and putting them under one roof – the Top Insiders Stocks tool. TipRanks’ proprietary AI scans the SEC reports about insider trades, translates it into easily digestible data, and then presents it to our users in several formats. 

This is one of the most popular tools on the TipRanks portal. You can navigate to this page by going to Stock IdeasTop Insiders Stocks. On this page, you will find four different trading strategies that TipRanks has identified based on insider trading activity. All strategies currently beat the S&P 500. Performance has been measured since January 2009 and each transaction is measured after one month. You can compare strategies to their sector or to the S&P 500. 

Transaction Strategy – This strategy includes the buy and sell transactions of All Insiders. 

C-Level Strategy – This strategy includes the buy and sell transactions of Officers only. 

Major Event Strategy – This strategy includes the buy and sell transactions undertaken by a major institutional investor, such as the owner.   

Top Ranked Strategy – This strategy includes the buy and sell transactions of Top-ranking Insiders only.   

As you scroll down, you can see the latest insider buy and sell transactions, labeled Hot Stocks by Insiders. This list shows you the trending stocks on which insiders are making trades, along with an indication of the Insider Strategy Signal as Very Positive or Positive. You can use this list to devise an apt investment strategy. Most of these strategies have generated handsome double-digit returns to date and can prove beneficial to your portfolio. 

It is important to note that this list includes only the Informative Buy trades. You can also see Signal Reasoning, which explains the insider trading trend behind the signal. Further, under the Activities tab, you can see a list of the number of shares with the dollar amount of the informative buy trade by the insider and the time frame. You can even customize the list through the dropdown Select Columns as well as download the data on an Excel spreadsheet.  

How to Use the Top Corporate Insiders Tool

Nobody knows the inner workings of a company better than its insiders. Following an insider’s trading calls can give you considerable insight into the company’s performance. If an insider is highly optimistic about a company’s future, it is quite likely they will go on a stock-buying spree and vice versa when they have some negative information about the company. From the buying/selling patterns of insiders, you can gauge the company’s trajectory.  

This is why TipRanks accumulates insider trading activities and ranks the insiders as per their historical performance. By ranking the insiders, TipRanks helps you decide which insiders are likely the best insiders to follow. These insiders have a proven record of making successful calls on their company stocks and earning generous returns on them, and you could succeed in investing by following their trading activity.  

You can navigate to this page by going to ExpertsTop-Performing Corporate Insiders. This page lists the Name of the corporate insiders along with information related to their Company, Role, Distribution of Buy and Sell Transactions, Success Rate, and Average Return earned. 

By default, the page lists the top insiders based on their success rates measured over a 1 Year time frame. You can choose to change the Period between 1 Month, 3 Months, 1 Year, or 2 Years. Similarly, you can choose to compare the returns against a Benchmark, such as the S&P 500 (SPX) index or the performance of stocks in the overall Sector.  

An insider’s performance is measured based on a 3-tier unique proprietary formula called TipRanks Star Ranking System, as explained below: 

Success Rate – An expert’s success rate is measured by the number of times a transaction wins or loses money. 

Average Return – At TipRanks, we consider the average return of all transactions as the best measure of an expert’s performance. By doing so, we rule out the possibility of single lucky hits and focus on the expert’s overall performance. 

Statistical Significance – A higher number of recommendations ensures the expert’s consistency. For this reason, an expert with more recommendations will have his or her ranking scored higher than an expert with fewer recommendation counts (with all other things being even). 

How to Use the Daily Insider Trading Tracker

Tracking an insider’s transactions can be a valuable strategy as insiders often have better practical insights into a company’s outlook than you and me. By following which stocks Insiders are buying or selling, you can see how those most in the know are trading, and thus, make informed investment decisions.  

That is why TipRanks brings you the Daily Insider Trading Tracker, which accumulates the latest insider transactions of companies in its database. The list includes both the informative and uninformative trading calls of C-level Executives, Directors, or 10% Shareholders of a publicly listed company. The list displays the Company Name, the Insider Name, Role, Rank, time frame when the trade was Assigned, Buy/Sell Trade, Amount of Trade, and the link to the original SEC Form. You can navigate to this page by going to ExpertsTop-Performing Corporate Insiders – Daily Insider Transactions 

What’s more, you can even sort the list based on the parameters you wish to see. These include the Role of the insider, nature of the Transaction, the Insider Ranking, the Amount of the trade, Sector, Period, and the Benchmark comparison. Now, go ahead and try following the insider’s trading calls and see how they profit your portfolio.  

How to Use the Insider Profile Pages

A corporate insider usually undertakes stock buying/selling activity based on the best possible information they have about the company. It could be informative to learn about an insider’s historical stock trading success rate and average returns earned. Before deciding to follow a particular insider, it could be worthwhile to study their profile. An insider with a high success rate and high average returns-generating capability could be on your radar to help you form investment decisions about a company.  

On an insider’s profile page, you will find information about their overall Profitable Transactions, meaning how often their transactions have generated positive returns. Plus, you can see the Average Return earned since January 2009. Moreover, you will see a breakdown of all the Insider Holdings and their Most Profitable Insider Trade to date. Also, you can see the different companies in which the individual has a key role and all their trades on those companies’ stocks.  

Moreover, you can see the success rate and average returns earned for the individual company along with the Last Transaction Date, Insider Position, Last Transaction, Last Transaction Amount, and Holding Value. You can choose to follow a specific insider’s trading activities by checking on the +FOLLOW button on the top right corner of the page and receive regular email notifications.  

To navigate to an insider’s profile page, go to ExpertsTop-Performing Corporate Insiders, and there you will find a list of all the corporate insiders that TipRanks tracks. Alternatively, if you know the name of the insider that you wish to study, you can type his/her name in the Search Bar on the top left corner of the page and select the insider from the dropdown window. Similarly, you can even navigate to an insider’s profile page by going to a company’s Insider Trading Tool and clicking on the Insider’s Name from the list of insider trades.   

How We Designate Corporate Insiders

TipRanks tracks over 102,000 corporate insiders of publicly traded companies. The types of insiders include:  

  • C-Level executives, such as the CEO, COO, or CFO 
  • Directors 
  • 10% + shareholders 

These insiders are in the best position to gauge the success/failure of the company as they are well-informed about the company’s happenings. Therefore, within their insider transactions hides the most lucrative information of all – private information. The investment rationale suggests that by mimicking the actions of insiders, both sell and buy transactions, one can achieve a higher return than through a simple buy-and-hold strategy. However, due to insider-specific incentives and trading noise, it is important not only to follow all the insiders’ transactions but also to identify which transactions are informative.  

Informative Transactions vs. Uninformative Transactions

While TipRanks consolidates thousands of insider trading activities daily, we go one step further and define these trades as informative versus uninformative. The reason? Informative trades hold more significance from an investor’s trading perspective compared to uninformative trades. While Uninformative Buys and Sells can occur due to myriad reasons, the Informative Buy essentially means the insider sees a bright future for the company, or at least a bright future for his or her own trading account.    

Uninformative transactions indicate that an Insider is buying/selling shares for reasons that do not necessarily indicate confidence in the company. Therefore, they do not hold much significance. For example, an Uninformative Buy in insider trading can be a trade made by an insider who is given shares as a form of compensation. Likewise, Uninformative Sells are often made by Insiders who are exercising options that are about to expire, or cashing in shares that are given to them as a form of payment. 

On the other hand, Informative Buy/Sell transactions are deliberately made by Insiders, thus indicating a vote of confidence in the company. The Informative Buy transaction particularly stands out as a Buy signal for anyone watching. An Informative Buy trade is an instance wherein an insider decides to make a purchase of company shares with his or her own capital. These are significant, as they show an assertion of confidence in the company and its future by the insider and indicate that the stock may gain in price thereafter.