We Don’t Care About The Insiders

Posted by Ivanhoff
on November 24th, 2010

It is a giddy time for momentum traders, who let the price to be their leading indicator. While the world is concerned about a potential war on the Korean peninsula and the media worries about the European sovereign debt crisis and insider trading, 25 of the St50 stocks are making fresh 3-year highs. Make sure that the unrealized profits in your holdings don’t vanish and take some off the table as the liquidity provides an easy exit.Yes, your stocks might continue higher, but as Joe Fahmy likes to say, this should not be a reason for concern. It just means that the market is healthy and there will be other fresh breakouts that will show up.

Howard Lindzon has an interesting post, pointing out that insiders don’t matter. Insider trading has always existed and probably it always will. This is one more reason to pay attention to price. Whatever insiders do, it will be most likely reflected in the price or in the options activity of the underlying stock. This doesn’t mean that you have to approve their actions. Just accept them, adjust your strategy to the reality and move on. Successful trading is not about having access to information. It is about proper execution, equity selection and risk management.

Some of the best performing St50 stocks this week:

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.