Insiders mostly sold off stocks amid the S&P 500's record highs. What does that tell us?

Corporate insiders mostly sold off their holdings in public companies in January, leading to the biggest gap in the monthly ratio of sales to purchases by top executives at public firms in five years, Bloomberg writes.

Nearly 1,000 executives from about 6,000 companies traded in the U.S. sold shares in their firms in January 2026, while only 207 executives made purchases, according to Washington Service data cited by Bloomberg.

It is difficult to understand whether the decisions of top managers were influenced by any other factors besides market dynamics, Bloomberg points out, noting, however, that the cautious stance of top managers of companies may serve as a warning signal against the backdrop of already existing market concerns about the overvaluation of large companies, the rapid growth of AI costs and geopolitical risks.

"The actions of corporate insiders have proven to be an important signal for future stock returns," said Integrity Asset Management portfolio manager Joe Gilbert. - Against a backdrop of geopolitical risks and high stock market valuations, we believe executives see these risks and are using the situation as an opportunity to lock in profits - and we think investors should pay attention to this," he added (quoted by Bloomberg).

The market decline at the end of the trading session on Thursday, January 29, clearly emphasized the continuing concerns about U.S. stocks, the agency points out - the day after the S&P 500 index updated the record and for the first time in history exceeded the mark of 7000 points, the S&P 500 and Nasdaq 100 closed in the red zone. Such dynamics they showed on the background of Microsoft's reporting, which increased investors' doubts whether the demand will justify large-scale investments in artificial intelligence.

In trading on January 30, amid the announcement of U.S. President Donald Trump as a candidate to head the Federal Reserve System, the S&P 500 lost another 0.33%, the Nasdaq 100 fell by 0.45%, the Dow Jones went down by 0.47%.

This article was AI-translated and verified by a human editor