What if I told you that there’s a group of traders that outpace the market?
And what if I said that we are able to know when and where they invest their own personal money?
Does that catch your attention?
You see there is this thing the US Securities and Exchange Commission (SEC) has called a “Form 4,” which it tucked away in a publicly accessible place called the “EDGAR Database.”
Every time an officer of a publicly traded company purchases the stock of the company they are employed by, they are required by law to file an SEC Form 4.
They must define their plan for the position and are required to hold it for a period of time that’s no less than six months.
What information does that offer us? Well, quite a lot, actually…
Conviction is Key
If we know this “corporate insider” is in a position with their own hard-earned money for a period of time no less than six months, it’s likely they may know something we don’t that could result in the company’s stock price rising.
If your main street small business was growing, and if you knew there was something in the pipeline that could cause the value to jump exponentially, I assume you’d be willing to put some serious cash on the line to reap the benefits from what’s coming, right?
This is really no different…
For example, if a company CEO realizes there’s a merger or deal in the making and decides to put some cash on the line, it’s reported with a plan, and they must hold that investment for a period of no less than six months.
It doesn’t matter to me if it’s Apple, Inc. (AAPL) or my hometown pizza shop on the corner… If they’re poised to grow, I want in on the action!
Follow the Insiders
The beauty in the stock market is I’m able to follow these insider investments without having to worry about disclosing a plan or being forced to hold it for any defined period of time.
If I buy the stock on Tuesday and on Friday into the close the value of the stock has doubled, I have zero restrictions and will be able to take my profits off the table.
On the other hand, the corporate insider would need to surrender their profits if they sold their position prior to holding the entire six-month period.
So, if you want to keep the odds in your favor, follow the folks who put their money where their mouth is!
The Insider Effect
Now, if you need some help finding the best way to take advantage of corporate insider buying, consider checking out my colleague Ross Givens and his work at Insider Effect.
Ross is holding a special session today at 12:00 p.m. ET, which is absolutely free to attend.
He’ll cover his strategy for trading alongside corporate insiders and generating potentially massive gains as a result.
Rules to Live By
“Things work out best for those who make the best of the way things work out.” John Wooden
Until next time, I wish you a beautiful and blessed day!
Yours In Trading Success,
Anthony Speciale Jr.