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http://finance.yahoo.com/tech-ticker/article/...MZN,BBBY,DHR,GILD,YUM"Massive Insider Selling": Pure Supply and Demand Makes a Bears' Case
Posted Jun 18, 2009 09:00am EDT by Aaron Task in Investing
Related: ^DJI, ^GSPC, AMZN, BBBY, DHR, GILD, YUM
Charles Biderman, CEO of TrimTabs Investment Research, says the rally from the March lows is going to end soon, if it hasn't already. His rationale is based on a complex analysis of a very simple thing: Supply and demand.
TrimTabs specializes in analyzing the supply of stock for sale and the demand for said stock; and the former is rising much faster than the latter, according to the firm.
Since the start of May, there have been $98.5 billion of secondary stock offerings (most notably by banks), 4.6 times more than the level of new cash takeovers and buybacks, Biderman reports. At the same time, there's been "massive selling" by insiders, to the tune of $3.9 billion vs. just $350 million of insider buying.
[On a separate but related note, Singular Research reports the firms with greatest volume of insider selling, in absolute dollar terms, are: Yum Brands, Bed Bath and Beyond, Amazon.com, Danaher and Gilead Sciences.]
Based on TrimTabs' analysis of data since 1987, Biderman says every time the supply of stock rises at these levels, the market falls sharply.