By Karim Rahemtulla One of the most accurate predictors of how a stock will do in the future is insider buying.
But there’s a catch…
There must be a pattern.
This pattern is called “cluster buying.” It’s when three or more insiders buy at varying prices, lower and higher, on the open market.
But there’s more. This pattern also requires that one or two of the insiders be officers or lower. Directors often buy as part of a program, and major shareholders who own more than 10% of the outstanding shares buy for varying reasons.
However, when an insider like the vice president of marketing or the legal …read more
