In the stock market, investors are constantly bombarded with noise. Earnings reports, analyst upgrades, and macroeconomic forecasts can often provide conflicting signals about where a company is headed. However, there is one signal that cuts through the noise more effectively than almost any other: insider buying.
When an executive or a director dips into their own pocket to buy shares on the open market, it sends an unambiguous message. Unlike stock options or grants, which are part of compensation, an open-market purchase is a voluntary risk of personal capital.
