Technology
Technology insiders: heavy selling, rarer buying
Why tech insiders sell so often
Software, semiconductor and hardware companies pay a large part of compensation in stock options and shares, so insiders' sales are frequent and often unrelated to their view of the business. Lakonishok and Lee (2001, Review of Financial Studies) find no predictive power in insider sales across the US market; the information sits in purchases.
Intangibles widen the gap
Aboody and Lev (2000, Journal of Finance) show that insider gains are substantially larger in R&D-intensive firms, which they attribute to the information asymmetry created by research spending. Ke, Huddart and Petroni (2003, Journal of Accounting and Economics) find that selling ahead of the end of an earnings growth streak is more pronounced in growth firms.
Growth versus value
Rozeff and Zaman (1998, Journal of Finance) find that insiders buy less in growth stocks and more in value stocks. A director buying shares of a technology company after a de-rating is therefore the less common event and, on the general evidence, the more telling one. All these studies use US samples. The site's own results are on the performance page.