When we see an insider buying a stock, it’s impossible to know the “why”. When we see an insider buying a stock, it’s impossible to know the “why”. Yeah, you can evaluate external market conditions. Sure, you can look at the insider filings themselves.
But it’s hard to tell what’s going on inside the company.
Here’s the thing, you don’t need to know the “why” if you spot this buying signal…
You see, one insider buying shares could be a sign that the stock is ready to move could be a sign that the stock is ready to move. But maybe not. It’s not super easy to tell with one person.
Yet what if you saw 5 big-shot insiders buy tons of shares. What do you think that means?
It means there’s some smart folks looking for massive upside in the stock. It means there’s some smart folks looking for massive upside in the stock.
This is called “cluster buying.” The more insiders that buy, the stronger the signal.
Biotech is a good sector to illustrate the power of cluster buys. Biotech insiders tend to scoop up their company stock in anticipation of some big event. In many cases, it’s an FDA event — especially with early-stage biotech startups.
For example, we spotted a cluster buy on one of these early-stage startups back in mid-July:
See that green bar at the far right of the chart? I wonder what made all those insiders scramble to scoop up their own stock?
1 month later, this firm announced they secured a patent for a cancer vaccine — and they’re the exclusive licensee.
Now that’s some huge news.
It doesn’t stop there, though. Once traders see a reason for buying in and spot the momentum, they pile in their capital…
Driving the stock even higher.
And that’s what makes this stock we’re talking about such a perfect candidate. It’s still at a reasonable buy point…
But not for long. Soon enough, traders will find this one and push it too high to be a buy. It’s already moving upwards.
Just think about what a cancer vaccine could potentially mean for the world…
And your bank account if you get in on the ground floor of this stock.
Don’t wait around, because the door’s closing fast on this stock’s entry…