A Wall Street saying about insider trading is that there are many possible reasons to sell a stock, but only one reason to buy—to make money. Selling a stock could mean that someone has inside information that the company is doing poorly, or it could indicate that the stockholder needs the money. When insiders buy, it could mean that they have private knowledge of a successful event for the company (such as a patent approval or regulatory approval of a product).
The “only one reason to buy” saying has been cited in print since at least 1991.
26 March 1991, Los Angeles (CA) Times, “Investors Tracking Insiders’ Stock Sales for Clues on Amgen Investments: The sale of shares in biotechnology’s hottest property by company executives has raised some eyebrows” by Barry Stavro, Business, pg. D1:
“There are a number of good reasons to sell stock. But there is only one reason to buy stock. You think it will go up.”
Profitable Investing in the New Century
By Andrew Feinberg
New York, NY: Money Books
Though some sales are red flags, the CEO may have lots of reasons to sell stock — diversification, estate planning, cash for a new house — but he generally has only one reason to buy: He thinks it’s a good investment.
Strategies for superior returns from today’s top traders
By Fari Hamzei
Hoboken, NJ : John Wiley & Sons
While insiders may have various reasons to sell stock, they have only one reason to buy: to make money!
Value in Time:
Better trading through effective volume
By Pascal Willain
Hoboken, NJ: Wiley
Follow the Insiders
Insiders have many reasons to sell, but only one reason to buy: to make a profit.
Cramer MAD about TheStreet.com’s Stock (TSCM)
Submitted by theStockMasters… on Fri, 06/18/2010 - 16:17
(WSJ.com) Television talk-show host Jim Cramer tells his viewers there are a million reasons to sell shares but only one reason to buy: a belief the stock price will rise.
Day Trading for Dummies
By Ann C. Logue
Hoboken, NJ: Wiley Publishing
In general, though, it’s safe to say that although there are many reasons to sell — to pay taxes, generate cash for college tuition, or meet a pension obligation, among many others — there’s only one reason to buy: You think the security is going up in price.
Investing | 11/28/2011 @ 11:28AM
CAKE Trading Below Director’s Recent Buy Price
There’s an old saying on Wall Street about insider buying: there are many possible reasons to sell a stock, but only one reason to buy.
New York City • Banking/Finance/Insurance • (0) Comments • Thursday, December 22, 2011 • Permalink