Insider trading (talking about legal insider trading, of course) typically beats the stock market by 10% — per year.
For those of you who’ve been following Tradestreaming for the past couple of years (and read my book), you know that I’m a fan of following the smart money.
By following the tradestream of hedge funds or the activity of corporate insiders, investors can create portfolios and strategies that have at least been proven in the literature to make money.
Insider trading is a treasure-trove of potentially-profitable information. Top managers at their firms are in the best seats to determine the future prospects for their stocks. If they reach into their wallets and buy their firms’ stocks, well, that’s an incredible useful signal.
An insider trading blueprint
There’s been some amazing research into insider trading. Recent studies have found that investors can mimic the returns of insiders to beat the market by 7 – 10% a year.
I wrote the 20+ page, The Harvard Guide to Insider Trading to describe these strategies and provide a quick blueprint to create portfolios comprised of the most useful insider trading.
AND, to teach you how to use insider trading strategies for your own trading/investing.
You can download it freely here.
I hope you like it — let me know (via email or in the comments) what you think.