What Stocks Are Insiders Buying? How to Find Out Yourself

The honest answer is that it changes every day, which is why any article listing specific stocks is wrong within a week of being published. What does not change is where the filings live and how to read them. This guide covers both, so you can answer the question yourself at any point rather than trusting a list someone wrote last month.

Thousands of insider transactions are disclosed every week across US and Australian markets. The work is not finding them. It is working out which handful are worth a second look.

Where the filings actually live

Both are free and both are primary sources, meaning nobody has filtered or interpreted them before you see them.

United States. The SEC's EDGAR database carries every Form 4. Officers, directors and holders of more than 10% of a company's equity must file within two business days of transacting. You can search by company or by individual, and the filing shows the date, quantity, price, whether the holding is direct or indirect, and what the insider holds afterwards.

Australia. Directors of ASX listed companies lodge an Appendix 3Y, the Change of Director's Interest Notice, within five business days. These appear in the company announcements feed on the ASX website.

That is the entire universe of legally disclosed insider activity in both markets, available to anyone, at no cost.

Why published lists go stale so fast

Three reasons, and they compound.

The filings keep arriving. A list published on Monday is missing everything lodged Tuesday through Friday, and in the United States the filing window is only two business days, so the flow is constant.

The price moves. Insider signals play out over months rather than days, but the market does not wait politely. By the time a buy has been written up, circulated and read, the entry point that made it interesting may have gone.

Most of what appears on those lists should not be there at all. Which brings us to the real problem.

Most insider buying is not what it looks like

This is where the majority of published lists fall over. They count every transaction labelled as an acquisition, and most acquisitions are not purchases in any meaningful sense.

A Form 4 carries a transaction code. Code P means the insider bought on the open market with their own money at market price. Code A means the company granted or awarded them shares as part of their pay. Both increase the insider's holding. Only one of them tells you anything about conviction.

A list that mixes the two is mostly a list of remuneration events. Filtering to open market purchases usually removes a large share of the raw flow before you have looked at a single company.

The filters that actually narrow it down

Once you are looking only at genuine purchases, four things separate a buy worth investigating from a buy worth ignoring. These are covered in more depth in our guide to what insider buying means, but in short:

More than one insider. Cluster purchases, where several insiders buy within a couple of days of each other, have been found to produce materially stronger abnormal returns than solitary purchases. Research by Alldredge and Blank put cluster buys at roughly 2.1% abnormal monthly returns, around 0.9 percentage points above single purchases. A CEO and CFO buying in the same window is the pattern to notice.

Irregular timing. Cohen, Malloy and Pomorski separated insiders who buy on a predictable annual schedule from those who buy at unusual moments. The opportunistic purchases produced around 0.82% abnormal monthly returns. The routine ones produced essentially nothing. Someone who buys every March is telling you about their own financial planning.

Size relative to their existing holding. A purchase that meaningfully increases what an insider already owns says more than a large dollar figure from someone who owns a great deal more.

Smaller companies. Lakonishok and Lee found insider signals carry more predictive power in smaller companies, where fewer analysts are watching and the information gap is widest. In a heavily covered large cap, most of what an insider knows is already in the price.

What to do once you have a name

Finding a cluster of opportunistic open market purchases at a small company is the start of the work, not the end of it.

Insider buying tells you that people who know the business are increasing their exposure to it. It does not tell you the company is sound, the valuation is sensible, or the timing is right. Insiders tend to be contrarian and frequently early, so these purchases often show up in companies whose recent price action looks unappealing.

The sensible next step is to check whether anything else independent points the same way, and whether the business itself stands up to scrutiny. A single signal, however well evidenced, is a reason to look closer rather than a conclusion.

Doing this at scale

Everything above is achievable by hand. It is also slow. Filtering thousands of weekly filings down to open market purchases, checking whether each insider trades routinely, grouping buys into clusters and weighting for company size is a considerable amount of work to repeat every week.

InsiderPulse automates that filtering. The platform draws on more than 100 data sources, reading insider filings alongside options activity, dark pool activity, news, social media and price behaviour, and produces a score from 0 to 100 for each asset with the evidence behind it shown rather than hidden.

The Insiders To Follow board addresses the other half of the problem. Instead of listing whoever filed most recently, it ranks insiders by the historical returns on their disclosed purchases and by the size of the transactions they make, so the names with the strongest record appear first.

InsiderPulse is a data and research tool. It does not provide financial advice, recommendations or picks, and nothing in it accounts for your personal circumstances.