27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
- Insider buying can be an encouraging signal for potential investors when markets face uncertainty.
- This past week, some insiders took advantage of biotech initial public offerings.
- Some insiders were making return trips to the buy window to increase their stakes.
Conventional wisdom says that insiders and 10% owners really only buy shares of a company for one reason -- they believe the stock price will rise and they want to profit from it. So insider buying can be an encouraging signal for potential investors, particularly when there is uncertainty in the markets, as there has been as the pandemic worsens.
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As the year winds down, plenty of insiders have purchased shares despite some market volatility and economic uncertainty. Here are some of the most noteworthy insider purchases that were reported in the past week.
In the past week, a couple of officers and some directors bought some Silverback Therapeutics Inc (NASDAQ:SBTX) shares at the initial public offering price of $21.00 per share. The total for the more than 1.54 million shares of this clinical-stage biopharmaceutical company they acquired added up to almost $35.5 million. The shares ended the week changing hands at $31.80 apiece, after hitting a high of $32.91.
Life sciences company Seer, Inc. (NASDAQ:SEER) also went public, and two 10% owners and a director scooped up almost 1.76 million shares altogether at the IPO price of $19.00 per share. That added up to around $33.41 million. Shares of this Redwood City, California-based biotech ended last week's trading all the way up at $75.65 per share, after hitting a high of $86.13 on Friday.
A Multiplan Corp (NYSE:MPLN) beneficial owner returned last week to purchase almost 1.60 million more shares of this health care services provider at $8.12 to $8.66 apiece. That totaled less than $13.33 million, and it raised that owner's stake to more than 1.71 million shares. Note that the same owner bought more than 114,000 shares in the prior week, and a director acquired shares as well. The stock ended the week trading at $8.47 per share, which is still within that owner's most recent purchase price range.
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So far this month, an Avis Budget Group Inc. (NASDAQ:CAR) beneficial owner has indirectly purchased more than 117,700 shares of this New Jersey-based company. At $38.52 to $39.20 per share, the total for these transactions came to over $4.57 million. This same owner also acquired nearly 254,700 shares back in November, and the stake was last seen at over 18.42 million shares. The stock ended last week's trading at $39.07 a share.
A director stepped up to the buy window last week and paid $5.86 to $5.89 each for 170,000 Ardelyx Inc (NYSE:ARDX) shares. That cost him approximately $1 million, and it brought his stake in this biopharmaceutical company to more than 417,200 shares. After a gain of over 5% in the past week, the shares were last seen trading at $6.68 apiece, so this director's purchases appear to be well timed.
Cannae Holdings Inc (NYSE:CNNE) saw its chief executive officer, Richard Massey, acquire 15,000 shares of this Las Vegas-based investment firm early last week. The purchase price averaged $42.33 per share, and that cost Massey more than $634,900. Shares of this value stock ended the past week with a fractional gain and were last seen trading at $42.52 apiece. The stock is up more than 14% year to date, about the same as the S&P 500.
See also: Insider Sells Aflac's Shares
Note that there also was some smaller amount of insider buying at Avnet, Inc. (NASDAQ:AVT), Coty Inc (NYSE:COTY), Crown Castle International Corp (NYSE:CCI), Dollar Tree, Inc. (NASDAQ:DLTR) and NVIDIA Corporation (NASDAQ:NVDA).
At the time of this writing, the author had no position in the mentioned equities.
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Photo from Pixabay.
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.