Wow. Aren’t you exhausted? What a week that was. Thrilling too. You never knew what was going to come at you next!
Question for you: How can I improve my commentary on directors dealings, or change the layout of these pages so that the information is more easily accessible by you. Please type your comments and any other suggestions or questions you may have in the ‘COMMENT’ box below. I very much value your feedback.
To skip straight to my commentary on each company type the stock name in the ‘SEARCH’ box to the left of here.
We’ve seen a few sells this week. Stocks worth noting for directors selling activity are Savills (SVS), De La Rue (DLAR), and Hargreaves Lansdown (HL.).
Savills (SVS) directors have been a pretty good signal for future share price performance, but the disclaimer must be ‘the past is no guide to the future, you can lose everything in the stock market’. On the positive side availability of capital should lead to some pick up in activity in real estate, on the negative side look at Savills huge cost base.
Hargreaves Lansdown (HL.) directors say ‘Volatility will impact profit growth’. CFO and Head of Accounting have been selling.
De La Rue (DLAR) CEO and CFO both sold this week, taking profits in a stock which is up 50% relative to the FTSE 250 index. Maybe the good news is all in the price.
On the buy side:
Shire (SHP) directors have been consistent buyers. They have a track record. And five of them are buying. Definitely worth a look.
New World Resources (NWS) fall of 50% in the last three weeks has prompted a number of directors to buy. This coal miner and coke producer is, of course, highly vulnerable to a slowdown in economic activity. The directors seem to be more confident than the stock market.
Heritage Oil (HOIL). We’ve seen a number of buyers in small oil companies over the last two to three weeks, including ROC, Arawak, Heritage, and Serica. This may signal a support level for the energy sector.
And what about Prudential (PRU)? Mark Tucker CEO invested GBP 100k on Monday 15th September at just shy of 500p. He bought 20,000 shares taking his holding to 1.5m shares. I don’t interprete this transaction to be a valuable signal as
-
-
Only Tucker is buying, no other directors, and
-
This is a tiny increase in his existing holding.
-
Granted, he is up 20% on GBP 100k in a week. Time will tell.
Enjoy the week ahead. Keep calm and think of the long term.
followthedirectors... a study of directors share dealings 
2 comments
Comments feed for this article
September 22, 2008 at 9:59 pm
Susan
Hi,
I can’t remember how I found your site but it’s very useful and completely fine as it is.
Keep up the hard work and thanks for your efforts.
Susan
September 22, 2008 at 10:58 pm
Zoltan
Hi Simon
It looks like you’ve already implemented the only (very minor) enhancement I would have wished for, namely a buy/sell indication flag. I recently decided to return to the sharemarket after a few passive years, and having previously studied market efficiency I was keen to investigate directors’ trades as a source of predictive information. To do this I used your analysis to construct a simple virtual portfolio and had to check and load in the buy/sell indication manually – but that was not hugely burdensome anyway.
Incidentally, the results of this reflected the findings of other studies that have shown that “general” directors’ trading has little informational value but that specific subsets – such as CEO, CFO and/or multiple exec directors (as reflected in your Strong category) – do have predictive value.
Thanks for the informative blog – keep it up!
Cheers
Zoltan