US stocks receive positive signals! After accurately bottoming out in April's sell-off, insiders are once again taking action: buying their own stocks at the fastest pace since May.

After the U.S. stock market experienced its most significant decline since April, insiders in companies have sparked a buying frenzy. In the past 30 days, executives of publicly traded companies in the U.S. have been buying stocks in their own companies, with the buying rate being the fastest since May. Data shows that the ratio of insider buying to selling stocks has risen to 0.5. The significant increase in buying has brought some relief to long investors who have been under pressure. In the past week, the S&P 500 index dropped by 3.1%, heading towards its worst month since April. While these executives are buying stocks, other buyers seem somewhat hesitant. Jay Hatfield, CEO and CIO of Infrastructure Capital Advisors, commented on the insider buying behavior, stating, "They are proving their words with actual actions. They are not engaging in short-term trades, but long-term investors are taking advantage of market pullbacks." Hatfield mentioned that he has recently increased his position in some stocks after seeing insiders buying these stocks, such as Marvell Technology, Inc. (MRCL.US). Hatfield stated that on Wednesday morning, he again purchased a large amount of shares of this stock. Earlier this year, insiders successfully predicted the sell-off in April. After U.S. President Trump announced comprehensive new tariff policies, they bought their own stocks at the fastest rate since 2023, before the market rebound - including the largest single-day increase since the 1980s. Following this, as the market gradually approached a series of new records (starting from the end of the second quarter), buying activities decreased. Traders generally approve of the actions of these executives. Morgan Stanley called the S&P 500 index's decline a "technical pullback," providing an opportunity for investors to increase their stock holdings. On Wednesday, the S&P 500 index rose by 0.4%, marking the first increase in four days. Market sentiment improved further after NVIDIA Corporation (NVDA.US) provided strong revenue forecasts for the current quarter, alleviating concerns about the significant growth in artificial intelligence spending fading. However, the S&P 500 index has already dropped by 2.9% this month, heading towards its worst November performance since 2008. Matt Lloyd, Chief Investment Strategist at Advisors Asset Management, stated that one reason investors are willing to buy in at a low is that third-quarter earnings data greatly exceeded Wall Street's expectations, with profits reaching their highest levels ever. The insider buying behavior at the end of that period has added some additional investor confidence in the prospects of U.S. companies. Brian Jacobsen, Chief Economic Strategist at Annex Wealth Management, stated that insiders are in a very favorable position when assessing a company's prospects. While insiders may view their company optimistically, net insider buying behavior could be seen as a bullish signal. Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management, pointed out that although insiders have intimate knowledge of their own company, they may not necessarily have a deep understanding of the stock market. Therefore, solely relying on insider buying behavior for market timing judgments may not be sufficient. However, net buying is a positive market sentiment indicator. Zaccarelli stated, "There are many reasons why insiders sell stocks, such as diversifying investments, paying taxes, or meeting funding needs, but the only reason insiders will buy back their own stocks is because they believe their stocks are undervalued."