My name is Simon Winfield, and I have worked in leading investment banks in London and New York over the last 25 years, marketing investment ideas to the worlds top institutional investment managers and hedge funds.

Over the years I have met with senior management of hundreds of UK and European companies. I found managements’ body language and what companies didn’t say to investors to be far more valuable than what they did say, and I learnt to take the corporate spiel with a large pinch of salt.

Directors personal share dealings cut through the talk. I see them as a sign of what management really think of the opportunities and risks their company faces, as well as the current and potential company valuation.

In looking at directors dealings I ignore all the ‘incentive plan’ deals, where the company matches what you buy. Why wouldn’t you buy stock if you’re getting it half price? I ignore all the options exercising too, as this is usually seen by directors as pay which needs to be turned into cash.

Anything I write here is my personal opinion, and is not a recommendation to buy or sell shares, just my commentary on activity in the market.

If you wish to contact me, either fill in the wee comment box at the bottom of a post, or send an email to followthedirectors@gmail.com


Reading List:

‘Profit from Legal Insider Trading’ by Moreland

‘The Vital Few vs The Trivial Many’ by Muzea, an ex broker who has set up an Insider Trading service for US stocks at : http://www.smartinsider.net/index.asp

‘Investment Intelligence from Insider Trading’ by Nejat Seyhun

Also see academic papers at:

The Profitability of Insider Trades in the Dutch Stock Market (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=498042)

‘Insider purchases, and not analyst recommendations, possess incremental predictive power for future stock returns’ (Hsieh, Ng and Wang, 2003- Analyst Stock Recommendations and Insider Trading Activities.)