Insiders buying stocks

Screening Filters

1. Market Cap ≥ $1,000,000,000 (Large/Mid Caps)

   • Purpose: Focus on more established, scalable companies where insider buying is more likely to be meaningful and better disclosed.
   • Rationale:
     • Larger companies typically have better reporting and governance, so insider trades are more transparent and less likely to be one-off anomalies.
     • It avoids tiny microcaps where even small insider trades can look “huge” in percentage terms but may be driven by illiquidity or manipulation rather than genuine conviction.

2. Monthly Average Dollar Volume ≥ $300,000

   • Purpose: Ensure the stocks are reasonably liquid and tradable.
   • Rationale:
     • Liquidity matters because insider buying in extremely illiquid names can appear “significant” simply due to low trading volume.
     • A liquidity floor helps you focus on names where insider buying stands out even in a more active trading environment, and where you can realistically enter/exit positions.

3. Price ≥ $5 per share

   • Purpose: Filter out very low‑priced / penny stocks.
   • Rationale:
     • Low-priced stocks often have higher volatility, weaker fundamentals, and more speculative or promotional activity.
     • Insider trades in penny stocks can be misleadingly large in share count while still representing trivial dollar amounts.
     • By focusing on stocks ≥ $5, “significant insider buying” is more likely to correspond to meaningful capital commitment.

4. Quarterly Insider Trading Dollar Volume ≥ 0

   • Purpose: Restrict the universe to companies with some recorded insider trading (buying or selling) in the last quarter.
   • Rationale:
     • A positive threshold ensures there has been recent insider activity; without this, you’d get many companies with no insider trades at all.
     • While the minimum is set at >0 (rather than a high dollar threshold), this serves as a pre-filter: from this universe, you can then sort or further screen by the amount of insider buying to find those with truly “significant” activity.

Why Results Match Your Goal (“significant insider buying”)

• The insider-trading-dollar-volume filter guarantees you only see companies with recent insider activity; you’re not wasting time on names with no insider participation.
• The market cap, liquidity, and price floors reduce noise from tiny, illiquid, or penny stocks where insider trades can be misleading, making it easier to identify insider buying that likely reflects real conviction in credible, investable companies.
• Once this cleaner set is defined, “significant” can be addressed by ranking or tightening the insider dollar volume threshold, which this setup is designed to enable.