The market has been trending lower, all major averages are testing the 50 day moving average.  In this kind of juiced up market, technical traders have an unwarranted influence. My guess is that we will undercut the moving average in a test of investor faith but this could go on for weeks if not months. Investors that lack confidence bail easily.  Short sellers know that- and they also know that corporate insiders are blacked out. Most companies have self-imposed restrictions on buying or selling their companies’ stock insider thirty days from quarter end. The following companies had large insider buying last week.  We are digging in to see what they see. For timely updates, follow us on Twitter. 


Insiders have been buying Flexsteel FLXS and we traded this name for some quick profitable pin action.  CFO Schmidt bought 59,343 shares at $16.63.  A director went along the ride for 5000 shares at $16.73. There have been steady insider buying all year with no sellers. Flexsteel’s core competencies are the design and production of furniture for residential and contract applications. Flexsteel sells to 50 countries around the globe and is carried by more than 1,200 retailers. The pandemic has been good for home and home/office furniture makers. This one merits further analysis.

Americans are on the move, leaving cities fleeing to the suburbs. Interests rates have collapsed driving up the value of income producing properties. Public Storage Director Havner purchase of 1900 shares of PSA at $214.85 looks like a smart pick to me.

Flotek Director Nierenberg comes back for more, buying 163,420 shares at $2.40. Last week Director David Nierenberg bought 690,147 at $2.00. We’re struggling to find the impetus behind this buy.

CEO Curtis Morgan made a big buy in Vistra Corp, VST with 41,176 at $18.18. Vistra (NYSE: VST) is a leading, integrated, Fortune 275 energy company based in Irving, Texas, providing essential resources for customers, commerce, and communities. Vistra combines an innovative, customer-centric approach to retail with safe, reliable, diverse, and efficient power generation. We would be a buyer here.

FTK is a beaten down oil and gas service company.  It develops and supplies chemistry and services to the oil and gas industries, and companies that make cleaning products, cosmetics, food and beverages, and other products that are sold in consumer and industrial markets. I guess it can’t get worse.  You decide.

We’ve been noting regional bank buys for some time. Insiders have nibbled in many names but the sector lags.  We don’t know what changes the sentiment but when the economy reopens, the sector might take off with a hint from the Fed that they may be able to reduce stimulus a tab in a healthier economy. Director Robert Beall bought 20,000 shares of Spirit of Texas Bancshares STXB at $11.75.  CEO and Chairman Martin bought 25,000 shares of Provident Financial Services at $12.78.  PFS is a New Jersey based bank. It’s up 5.47% as we write this.

COO McCann bought 33,935 shares of Limbach Holdings at $7.44.  Limbach Holdings, Inc., (NASDAQ: LMB) with revenue of $546.5 million in 2018, is an integrated building systems provider – managing all components of mechanical, electrical, plumbing and control systems, from system design and construction through service and maintenance. 

We confess we don’t get the interest in LMB. The stock has been steadily climbing all year on a flat revenue trajectory.  Unless there is a huge stimulus bill that they would be the beneficiary of, we don’t see paying up for flat revenues.  As usual there may be a catalyst we are not aware of.

H&R Block has some insider buying.  CEO Jones bought 12,150 shares at $15.04. Director Gerard bought 12,000 shares at $15.17. HRB is a value play, trading at low P.E. and low multiples of free cash flow. HRB has a 6.9% dividend yield.  HRB is not likely to have any growth so investors should not expect much more than an out sized dividend yield.

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 company better than the people running it.  This common sense approach to investing has outperformed the market by 400% since 2001, the year I quit being an insider myself and started investing with this proven strategy.

If you would like to hear more about how you can get involved with the Insiders Fund, please email, call, or schedule some time on my calendar.   The Fund admits new investors and accepts additional investments on the 1st of each month.

Harvey Warren Sax
Founder and Manager of Alpha Wealth Funds
Hedge Fund Insomniac Guy
hsax@alphawealhfunds.com
wk  (435) 658.1934
cell  (435) 962.4554

Hedge Funds

Warren Buffett would be the first to tell you that emerging fund managers can often outperform legendary investors such as himself because smaller size funds have so many more opportunities to move the needle.  Alpha Wealth Funds currently offers three unique emerging funds.

The Insiders Fund focuses exclusively on what insiders are buying and selling.  Portfolio manager Harvey Sax has deployed this strategy since 2001 with 4x return of the market during that time. According to the portfolio manager, the market is not cheap by any means, fundamental or historic, NONE THE LESS, there are always situations that the crowd has missed.  These are most often highlighted by large insider buys.

Theta Funds has a 7-year track record with exceptionally low volatility, a beta far lower than the market.   It ‘s manager, Russell Kellites has been recognized numerous times by Barclay Hedge, a leading independent 3rd party data vendor, as best in its class. Morningstar ranked Mr. Kellites, the #1 fund manager in his peer group for 2018.

The Volatility Advantage Fund, our newest fund, is a long-short equity fund that adds time value to your portfolio through options contracts and volatility hedges. It is designed to create excess returns from the irrational yet predictable over-reactions to news events and market gyrations. Volatility Advantage Fund is not for the faint of heart but has the potential to make large Alpha.

Separately Managed Accounts

 We offer separately managed accounts.  A separately managed account is a portfolio of individual securities.  Your accounts are not commingled with others and are in your complete control.  Our four model portfolios, back-tested, and independently verified have each outperformed their benchmarks by double digits.

Financial Planning

Our Financial Planners are all held to the highest standards of the CERTIFIED FINANCIAL PLANNER™ designation. The plan we develop for you is independent of our products and services.  You can enact it  yourself or if you prefer to have us do the work, the financial plan fee may be waived in part or in its entirety. This is a high touch service that guarantees it will answer the questions you are asking or its free. Our money back guarantee is limited in that we will continue to work on your financial plan with no limit to hours spent until you are 100% satisfied.

The Standards of Professional Conduct (Standards) define financial planning as “the process of determining whether and how an individual can meet life goals through the proper management of financial resources.”  We will always act as a fiduciary.

Disclaimer: All investments involve risk. Past performance is no guarantee of future results.  Hedge funds are for accredited investors and are sold by prospectus only.  SMA accounts are Independently designed and tabulated by Alpha Lab Creative. The projected performance and volatility levels described herein do not represent the performance of the Managed Account or of any other account. Rather, the performance results shown reflect the hypothetical returns achieved through backtesting. Hypothetical performance results do, however, have inherent limitations. Hypothetical returns do not represent performance results that were achieved by any investor in any account and are calculated through the retroactive application of the Adviser’s model portfolio configuration.