Insiders are making big-time purchases in three companies they work for, own, or have close business relationships with. A quote from famed investor Peter Lynch provides insight into why insider buying is a signal investors should pay attention to. Lynch said, "Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise." This shows that insider selling isn't always a bad sign, but that insider buying is a clear positive sign.
Under Lynch’s leadership, Fidelity’s Magellan Fund achieved an average annual return of more than 29% from 1977 to 1990. This massively exceeded the return of the S&P 500 Index over that period, cementing Lynch’s place as a legendary investor.
