You have to love investors that put their money where their shareholders are. None are better than this than Richard Kinder, pipeline magnate. He bought almost $8 million of his namesake company, Kinder Morgan.  The 5% dividend yield looks both juicy and secure.

Las Vegas Station Casino owner continues to pile into Red Rock Resorts. Maybe he hasn’t heard that a recession is on the way.

Dish shareholders continue to bet the farm on the license spectrum and their highly risky and leveraged 5G buildout. 5G cellular is supposed to change everything and no doubt it will change Dish.

Wayfair director Kumin continues to bet big on this as of yet unprofitable but fast-growth online household furniture and lifestyle company, Wayfair. We are passing on this as it looks like a big VC firm, other people’s money.

GOGO – don’t ask me to explain this insiders’ fascination with losing money on in-flight WIFI company GOGO.

CEO of chemical giant LyondellBasell bought $500k.  If this is bottom fishing and taking one for the team, it might be a good contrarian bet as LYB is now yielding 5.4%.

Symbol Company Insider Relation Shares Price Mkt Val
DHR Danaher Corp Rales Mitchell P Officer/Dir 2,500  $139.52  $348,800
GHL Greenhill & Co Inc Bok Scott L CEO 36,761  $13.71  $504,129
JCI Johnson Controls International PLC Haggerty Gretchen R Dir 6,220  $41.40  $257,508
KMI Kinder Morgan Inc Kinder Richard D Chmn 400,000  $19.95  $7,979,760
LYB LyondellBasell Industries NV Patel Bhavesh V CEO 7,246  $68.85  $498,873
MGM MGM Resorts International Rafiq Atif Officer 8,761  $28.55  $250,097
OXY Occidental Petroleum Corp Brown Oscar K VP 5,000  $42.62  $213,100
TH Target Hospitality Corp Archer James B Chmn 64,084  $6.24  $399,884
VBTX Veritex Holdings Inc Bolin Patrick S Dir 21,000  $23.03  $483,680
WTI W&T Offshore Inc Krohn Tracy W Chmn 100,000  $4.06  $406,000
BHF Brighthouse Financial Inc Rosenthal John VP 10,000  $35.61  $356,100
CALX Calix Inc Plants J Daniel Dir 60,125  $5.88  $353,325
DISH DISH Network Corp DeFranco James II Officer/Dir 300,000  $31.18  $9,354,000
GOGO Gogo Inc Townsend Charles C Dir 134,349  $3.96  $532,573
INTL INTL FCStone Inc Branch Scott J Dir 10,853  $36.92  $400,645
KMI Kinder Morgan Inc Kinder Richard D Chmn 300,000  $19.76  $5,927,460
OLN Olin Corp Sutton Scott McDougald Dir 15,000  $15.66  $234,882
PH Parker-Hannifin Corp Harty Linda S Dir 3,000  $158.39  $475,175
RRR Red Rock Resorts Inc Fertitta Frank J III Chmn 555,149  $19.30  $10,711,600
SPKE Spark Energy Inc Maxwell W Keith III Chmn 34,726  $10.22  $354,976
W Wayfair Inc Kumin Michael Andrew Dir 29,000  $109.75  $3,182,611
JCP JC Penney Co Soltau Jill A CEO 500,000  $0.56  $279,900
JCP JC Penney Co Teruel Javier G Dir 500,000  $0.59  $293,950
SNWV SANUWAVE Health Inc Richardson Kevin A II Chmn 5,569,910  $0.11  $891,186
SNWV SANUWAVE Health Inc Stolarski Anthony Michael Dir 10,811,864  $0.11  $1,729,898
SNWV SANUWAVE Health Inc Stolarski Anthony Michael Dir 225,000  $0.08  $43,875
CLUB Town Sports International Holdings Walsh Patrick D Chmn 395,126  $1.68  $664,641
TSC TriState Capital Holdings Inc Getz James F Chmn 25,000  $19.41  $485,213
CYH Community Health Systems Inc Smith Wayne T Chmn 1,200,000  $1.99  $2,382,480
EGLE Eagle Bulk Shipping Inc Leand Paul M Jr Chmn 59,300  $4.17  $247,435
EWBC East West Bancorp Inc Krause Douglas VP 6,400  $39.19  $250,816
EWBC East West Bancorp Inc Ng Dominic Chmn 25,840  $38.71  $1,000,313
EWBC East West Bancorp Inc Oh Irene H CFO 6,400  $39.10  $250,240
GTE Gran Tierra Energy Inc Smith David P Dir 205,000  $1.28  $262,400
NSP Insperity Inc Clifford Tim Dir 2,500  $97.35  $243,375
UNH UnitedHealth Group Inc Flynn Timothy Patrick Dir 2,000  $227.55  $455,094
ABBV AbbVie Inc Donoghoe Nicholas VP 7,525  $66.19  $498,057
CNNE Cannae Holdings Inc Massey Richard N Dir 20,000  $28.49  $569,810
KSM DWS Strategic Municipal Income Trust McClayton William R Dir 21,093  $10.43  $220,000
ICPT Intercept Pharmaceuticals Inc Akkaraju Srinivas Dir 5,207  $60.32  $314,086
LILAK Liberty Latin America Ltd Zinterhofer Eric Louis Dir 81,407  $16.02  $1,304,311
PRTS US Auto Parts Network Inc Kanen David Dir/>10% Own 333,000  $1.32  $438,794

Insiders sell stock for many reasons, but they generally buy for just one – to make money. THE INSIDERS FUND invests in companies at or near prices that management has been willing to invest significant amounts of their own money in.  After all, who knows a business better than the people running it?  You’ve always heard the best information is inside information.  This is as close to “insider information” that an ordinary investor is likely to see- and it’s entirely legal.  Officers, directors, and 10% owners are required to inform the public through a Form 4 Filing any transaction, buy, sell, exercise, or any other with 48 hours of doing so. This info is available for free from the SEC’s Web site, Edgar, although we subscribe to the Washington Service as they provide a way to manage and make sense of the vast realms of data.

As a rule, we only look at material amounts of money, $200 thousand or more, as anything less could just be window dressing. The bar is different from selling because the natural state of management is to be sellers. This is because most companies provide significant amounts of management compensation packages as stock. Therefore, with selling, we analyze for unusual patterns, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52-week lows. Another red flag is large planned sale programs that start without warning. Unfortunately, the public information disclosure requirements about these programs referred to as Rule 10b5-1 is horrendously poor.  I also generally ignore 10 percent shareholders as they tend to be OPM (other people’s money) and perhaps not the smart money we are trying to read the tea leaves on.

Of course, unintuitive as it may seem, insiders can also be wrong about their Company’s prospects, they can easily be wrong about how much others will value them, and in many cases, maybe most cases have no more idea what the future may hold than  you or I. In short, you can lose money following them.  We have and we curse aloud, what were they thinking!  Needless to say, past good fortune is no guarantee of future success.  We may own positions, long or short, in any of these names and are under no obligation to disclose that. We welcome your comments on our analysis.

This blog is solely for educational purposes and the author’s own amusement.  Investing with The Insiders Fund is for qualified investors and by Prospectus only. Nothing herein should be construed otherwise.  To learn more about our strategy, visit our website.

If you would like to hear more about how you can get involved with the Insiders Fund, please schedule some time on my calendar

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