Show HN: Dashboard for tracking insider trading at S&P 500 companies

https://www.quiverquant.com/sources/insidertrading

by greatwave1 • 6 years ago

202 80 6 years ago

quiverquant.com

_curious_• 6 years ago

Thanks for sharing. What was the motivation to make this and use case?

capableweb8• 6 years ago

Nice idea! More citizen tools for observing and inspecting the elite is always welcome and good project to work on.

Some feedback:

- INSIDER CONFIDENCE INDEX is missing some sort of description, not sure if it's actually Insider Sentiment Index which is a establish term or if it's something else.

- Increase the contrast as almost all of the text (except table headers text) is hard to read without really focusing.

greatwave12• 6 years ago

Thanks for the feedback! The insider confidence index is a ratio of net insider selling/buying to the total average volume of a stock in the last 30 days. I will make sure to add a better description, and try to improve the fonts.

capableweb8• 6 years ago

try to improve the fonts

The contrast is less about the fonts and more about the colors. Just making the darker a bit more darker and the light a bit lighter should solve the problem.

By the way, seems the page is now behind a login page, so it requires a signup, it was not like that before, so you're now not adhering to the guidelines for Show HN.

Blog posts, sign-up pages, curated lists, and other reading material can't be tried out, so can't be Show HNs.

https://news.ycombinator.com/showhn.html

jp555• 6 years ago

"More citizen tools for observing and inspecting the elite"

Yeah, this is a big reason smart people do not go into politics; the armchair-expert mob.

capableweb8• 6 years ago

Boo-hoo, you can't handle the critic of the public, then sure, don't go into the spotlight. Better that way as well so win-win for everyone.

Do you have any sources where these self-proclaimed smart people tell us about their reasons for not going into politics? Many of the mainstream-smart people seem more interested in getting as much money for themselves than working for the public good.

a-wu• 6 years ago

Appears to be hugged to death.

IanCal• 6 years ago

Currently 502ing, is there a description you can put up in a comment while it's down? Interested to know what this is, how it works.

cybert00th• 6 years ago

Not sure if this is local to just me (UK) but, when I try and load the site, it either 502s straight away or times out without loading.

Anyone else seeing the same?

edit: OK I see others are experiencing the same thing.

bko7• 6 years ago

I'm skeptical of claims that insider trading is prevalent among those that are not professional traders. I recently analyzed the trading activity of Senators [0], and found the evidence that rampant insider trading to be unconvincing.

In its simplest form, insider trading consists of someone knowing something about performance or similar relative measures that would affect a stock price. But as Matt Levine points out, knowing the future isn't that helpful [1]. Research found that even when it has been proven that professional investors had and acted on insider information, their track record was still spotty.

I even made an app [2] where you can get a companies past and future performance numbers, and you try and guess which of two opposite paths the stock took. I call it the insider trading game, and its a lot harder than it looks.

[edit] Just reminded of the Jim Cramer still showing two headlines: "More than 16M Americans have lost jobs in 3 week, dow's best week since 1938" [3]. I'm skeptical a non-professional trader would be able to somehow deduce strong stock market performance from early access to something like 16mm Americans having lost their jobs in 3 weeks.

[0] https://medium.com/ml-everything/analyzing-us-senators-stock...

[1] https://www.bloomberg.com/opinion/articles/2019-11-26/knowin...

[2] https://insider-trading-game.netlify.com/

[3] https://i.redd.it/rrnajxjdb6s41.jpg

Gys• 6 years ago

This post [0] in a related disccusion yesterday refers to research in 2004 [1] that clearly concludes senators did better trades than the index. But maybe times have changed. Or senators.

[0] https://news.ycombinator.com/item?id=22837708 [1] https://projects.iq.harvard.edu/files/gov2126/files/ziobrows...

bko7• 6 years ago

I've heard about this study but haven't read it carefully. My problem with these studies is that their methods of analysis are overly complicated I'm not knowledgeable enough to know if the results are being managed.

The range is from 1993-1998 while this was published in 2004. I'm not sure why that range was selected.

Also, consider the universe:

Initially, we begin with 6,052 transactions. Before analysis we apply several screens to the data. Only U.S. common stocks are included in the study. These screens eliminate, among other things, all preferred stock, ADRs, REITs, foreign stocks, and mutual funds. We also eliminate all initial public offerings (IPOs) from the sample.2 In total, 360 observations are eliminated for the reasons given above. Among the surviving transactions, approximately 59% of the stocks are listed on the NYSE, 40% are traded on the NASDAQ, and about 1% are listed on the ASE.

Why eliminate those other things? Would the conclusion have changed if they had been included?

As indicated previously, Senators report transaction amounts only within broad ranges.

Ranges are as follows:

$1,001 to $15,000

$15,001 to $50,000

$50,001 to $100,000

$100,001 to $250,000

$250,001 to $500,000

$500,001 to $1,000,000

over $1,000,000

And from the paper:

As before, we again estimate the value of their trades using the midpoint of the range reported by the Senators for all transactions less than $250,000. For all transactions above $250,000, we assume a transaction size equal to $250,000.

Why floor it at 250? Why not keep the midpoint, at least for 250 - 500 and 500 - 1mm?

I also thought it was odd to look at two portfolios, one of buys and one of sells. If the buys outperformed, but sells were a lot larger, then its not a good strategy on the whole. That's before we even get to the performance measure used.

Think could all be above the board and decided upon prior to actually crunching the numbers. But there are too many things here for me to definitively buy the narrative.

awinder• 6 years ago

I can’t tell because the post source is hugged to death but I’m just speculating that this is utilizing sec form 4 data or similar sources? There can be some interesting signal there that you could incorporate into a trading strategy but that’s mostly semantic and another story, I totally agree with you broadly. It will be a minor miracle if there isn’t fraud that washes out with a market crisis of this scope, but I’ll be amazed if the grand majority of trading isn’t above board.

Really enjoyed your medium series btw!

mettamage• 6 years ago

This sounds like a fun game! There was at one point also this game called chartgame.com, the interface when the site was still old is subtly (but importantly) different from now [1]. The most fun thing IMO was that you'd see the company name after you were done with that particular company. It was made to see whether technical analysis worked.

On another note, I was wondering how you got the data. So I opened my Chrome dev tools to see. I'll be checking financialmodelingprep.com out!

[1] https://www.youtube.com/watch?v=lJAw_LXcUgY -- someone playing the old version

bko7• 6 years ago

Financial Modeling Prep is amazing. Incredible that its free and well documented. My proudest github star [0] is from the creator of Financial Modeling Prep, Antoine Vulcain, who liked my site.

[0] https://github.com/breeko/stox

api• 6 years ago

It would certainly be possible for them to abuse their position in this way, but there may be enough counter motivations. Most are already wealthy, so they are not going to be hungry for money. They are also fearful of negative publicity or information that could help a political opponent. Abusing their position to trade stocks could easily end up in an opponent's attack ad.

lonelappde4• 6 years ago

People don't get wealthy without being hungry for money. Money hunger isn't satiated by money.

mlinsey• 6 years ago

I feel like most quarters won't necessarily give easy opportunities for insider trading, because stock prices over the course of the quarter are greatly moved by macro trends that are hard to forecast. But there are definitely some short-term events that move a stock in fairly predictable ways (an acquisition offer, an imminent recall, earnings coming in way way above or below guidance, etc). With a bit of leverage it's easy to just wait and make plenty of money off of particular events rather than maintaining a continuous insider-trading portfolio. Of course this strategy makes your trades much more suspicious too...

kelekekkkd8• 6 years ago

So if no one can play the market successfully, it’s socialism propping up the rich and forced austerity for the poor to maintain the “story”, as Trump calls it, romantic nonsense as Thiel writes about it, propping up the imagined belief we need elites pushing us forward.

Elite wealth managers alone, btw. A minority of rich actually have marketable skills.

Has nothing to do with business acumen (math models have shown one time success was luck not skill and continued success is simply bought; hi Bloomberg)

So yeah let’s keep playing this game, guys! Physics I’m sure shows somewhere this was predetermined by the motion of the stars and matter we can’t see.

Why NOT subject the mathematical majority to a system that (conveniently) won’t educate them well enough to even offer a chance at falsifying the underlying presumptions!

wtf_is_up• 6 years ago

Cope.

take_a_breath• 6 years ago

All information is not created equal. Classified briefings on a virus that may shutdown entire sectors of the economy isn’t the same as unemployment numbers. Everyone knew a ton of people were going to be laid off.

From your blog: “Here’s a trade from David Perdue, the great Senator of Georgia. He actually made nearly half the trades of our dataset, and it makes sense since he’s worth $15.8 million”

Why would it makes sense for him to make half the trades because he is worth $15.8 million? Plenty of Senators are worth more than that.

capableweb8• 6 years ago

he’s worth $15.8 million

On a unrelated note, how the hell can a senator sit on so much and be worth so much? Aren't they supposed to have the public in their main interest? Sitting on all those assets looks really suspicious. Seems they care more about themselves than their community/country.

bko7• 6 years ago

He's the 25th wealthiest member of the Senate. To be fair, out of 240 trades, 206 of them were between 1,000 and 15,000. Turnover in his account between those three month was somewhere between 950k - 5.34mm, with up to 536k - 3mm in purchases. I don't think this is unusual volume for something with a net worth of 15.8mm, but I could be wrong. He seems to like day trading.

vladimirralev• 6 years ago

Let's consider a recent example. The massive Fed/Treasury coordinated $2T+ bailout from last week. This thing came as a surprise to most us. Prior to this we saw 10 days of "weird" bullish activity. Market was going up on incredibly bad news, some banks such as Goldman advised high-end clients to buy stocks for unknown reason. And then the news came. Later it was revealed that this SPV had wide congressional support. So 1000s of officials from the White House, Fed, Treasury dept and Congress were sitting on this info for 2 weeks. Now add their staff that worked on getting this done, lawyers, accountants, advisors, regulators, oh and BlackRock who executed the deal. There is exactly zero chance this piece of info wasn't leaked to all high end clients in the banks at least a week in advance.

bko7• 6 years ago

I don't doubt it was leaked. But even with that information, unprecedented Fed support was speculated for some time but crystalized on March 3rd when Fed lowered rates 0.5%. the market still went down since then. Maybe it didn't go down as much as it would have had the Fed not intervened, but that's difficult to profit from. Market recovered a bit and you can point to another Fed policy in hindsight and say this caused the rebound.

andreilys2• 6 years ago

“knowing the future isn't that helpful”

Did you actually read the article? It specifically talks about press releases put out by companies. That’s just a sliver of the type of insider trading knowledge you can trade off of.

There are all types of other insider info. For example if you work at the FDA and know in advance what drugs are about to be approved/rejected.

Also I tried your app and the prompt it gives is... not even close to insider info

“ Regeneron Pharmaceuticals Inc is an integrated biopharmaceutical company. It discovers, invents, develops, manufactures, and commercializes medicines for the treatment of serious medical conditions.”

I fail to see how this is helpful info? Now if on the other hand it said “the company discovered a COVID drug in final approval with FDA”, that would be much easier to trade on.

bko7• 6 years ago

Look below the chart, you get their financial statements and metrics, including the ones are in the time span you're trying to predict.

komali2• 6 years ago

Did you actually read the article?

This is a verbatim example of not assuming good faith in the guidelines for this site

daniel-levin• 6 years ago

I have experience working on civil investigations of financial crime. It takes a very long time to prosecute white collar crime of all kinds. Especially insider trading. The most effective technique is to overwhelm the accused with reports containing facts that don’t constitute cold, hard evidence of crime, and then wait for them to buckle under the pressure and admit guilt

ptbello• 6 years ago

I recently analyzed the trading activity of Senators [0]

How is this relevant? Surely any senator knowingly engaging in insider trading wouldn't do so directly. They would get someone else to profit from the info and give back to them in either untraceable or legit ways.

philipodonnell• 6 years ago

Insider trading By elected officials isn’t against the law. There’s no reason for them to hide it. There have been several recent examples of senators openly insider training and no repercussions for being caught.

AznHisoka• 6 years ago

I agree that insider trading is less prevalent than people think, simply because lots of people love to believe in conspiracy theories, and put on a tin foil hat.

However, in the Bloomberg article you mentioned, it was cited that the hackers had a 77% success rate. Any serious investor would tell you that's an incredibly high success rate, as it's impossible to be 100% right all the time. If you had that hit rate, you're almost guaranteed to beat the index by a very large margin.

Lastly, it's possible to still have insider info, and not make money on the trade. That doesn't make it legal, though, does it? I think that's still insider trading - it's just making the wrong bet. If I had access to all insider info, I'd be super picky. Ignore 99% of what I hear (ie 16M Americans are unemployed, big whoop! everyone knows), and only trade on the 1% of info that will almost certainly move the markets (ie COVID-19 will shutdown entire cities). Extremely difficult to do if you love trading, but the optimal strategy.

nosuchthing• 6 years ago

If only we could trace insider trades using some sort of big data system. Hmm.

https://www.reuters.com/article/us-column-insidertrading-saf...

  KID TRADERS

  Using data on a half a million accounts from Finland from 
  1995 to 2010, the study came to a surprising conclusion: 
  accounts set up to benefit kids 10 years and under did 
  really well at stock picking, and did especially well just 
  before mergers, earnings releases and events that generate 
  big stock moves.


  The analysis was possible since Finland makes available 
  unusually detailed information about the identities of 
  investors.


  “When guardians trade through under-aged accounts, there 
  is a relatively high probability that they are trading on 
  private information,” the authors, Henk Berkman, at 
  University of Auckland, Paul Koch at the University of 
  Kansas and Joakim Westerholm at the University of Sydney, 
  conclude in a paper slated to be published in the Journal   
  of Finance.


  The gap between the junior set and typical accounts held 
  by adults was striking: in the day following trades made 
  by kids, their accounts outperformed the adult accounts by 
  9 basis points.


  Ahead of major earnings announcements, the kids chose 
  correctly whether to buy or sell 57 percent of the time 
  and beat their elders by 1.1 percent in the following day.


  It gets even better - at least for junior. On trades made 
  the day ahead of a merger announcement, juvenile 
  portfolios outperformed by 12 percent the following day, 
  and made the right decision to buy or sell an uncanny 72 
  percent of the time.


  The rest of the market, by the way, chose correctly 
  whether to buy or sell only 50 percent of the time.


  This is probably not all due to inside knowledge, 
  according to the study. The guardians tended to be richer 
  and may simply have been more successful at investing, the 
  authors argue, due perhaps to higher intelligence or an 
  advantage in obtaining legal, but valuable information.


  Even so, the fact that the juvenile accounts outperformed 
  ahead of mergers while the guardians’ accounts did not 
  implies that the adults were smart enough to know better 
  than to trade on inside knowledge in an easily traceable 
  way.

Endlessly• 6 years ago

“knowing the future isn't that helpful” — while true, it’s irrelevant as it relates to if the behavior is criminal insider trading activity, even if the trade resulted in no gains, it’s still criminal behavior.

firstfewshells2• 6 years ago

I think what would be more useful would be to have a summary of bulk deals for the major index tracking ETFs and S&P 500 companies. I haven't been able to get this data on any free platform.

jklein112• 6 years ago

I'm not sure I understand what you are looking for? Do you have more information about these "bulk deals"?

firstfewshells2• 6 years ago

Basically, trades that exceed a large amount, say $10 million worth of Delta stock bought or sold.

Emptysister• 6 years ago

nginx/1.10.3 (Ubuntu), really?

greatwave12• 6 years ago

The site kept getting hugged to death, so I'm temporarily adding a free login gate to reduce the traffic load

capableweb8• 6 years ago

Keep in mind by adding that gate, you're no longer adhering to the guidelines of Show HN. I advise you to read through them before submitting more stories: https://news.ycombinator.com/showhn.html

throwaway828282• 6 years ago

It might be a good idea to understand the guidelines before 'advising others.'

The idea for this guideline is not to link to a teaser that can't be used. You can use this. You just need to sign in.

dang2• 6 years ago

If the page explained why you added the form and made it clear that people are still welcome to try out the project, it would probably help.

Most likely, clicking and encountering nothing but a login form is the reason why people started flagging the submission. When users see a page like that, they pattern-match it to a different kind of submission—a boring corporate promotion designed to collect signups. (We get a lot of those.) Keep in mind that many readers will have clicked before looking at the comments.

annoyingnoob• 6 years ago

Straight to Login/Signup with no content? Must be a honeypot.

rnotaro• 6 years ago

Logins for the login gate:

Username: testest

Password: testest

joeskyyy• 6 years ago

Ahahaha, I thought you were merely joking... apparently not!

IBCNU• 6 years ago

bah - signup?!

keanebean86• 6 years ago

It wouldn't let me use my preferred username: <a> Worst. Site. EVER!

jonluca• 6 years ago

Flagged for taking you straight to a signup page, this is not Show HN eligible.

whydoineedthis2• 6 years ago

fair flag. here's the home page for anyone interested. https://www.quiverquant.com/

voisin• 6 years ago

Still requires signup (at least on mobile) to see anything.

bko7• 6 years ago

Their homepage doesn't offer much either. Their blog has one post that shows an dual-axis line graph of % odds of a Sanders win and Tesla dollar stock price over 2 1/2 months. That comparison is laughably naive.

https://www.quiverquant.com/blog/

maest2• 6 years ago

This goes straight to a signup page.

somid32• 6 years ago

Ugg, guys finviz.com already has this and they provide WAY MORE INFORMATION than what is provided. For example, let's look at Amazon:

https://www.finviz.com/quote.ashx?t=AMZN

You can see who, when, which quantity, dollar amounts, dates... I signed up with your system and you only show in the LAST 6 MONTHS -- why not last century? Your title is a complete click and bait.

akudha• 6 years ago

how do they get the data so soon (15 mins)?

somid32• 6 years ago

It is not in the last 15 mins. You'll notice there are two columns, the trade date -- in the middle, and the SEC filling date on the right. Sometimes people don't report for months.

maest2• 6 years ago

Insider trader data has been mined to death, fyi. If there was ever any alpha in it, it's long gone.

dannykwells• 6 years ago

Some great correlation = causation analysis here (Sanders win likelihood vs Tesla stock):

https://www.quiverquant.com/blog/

Sounds like the founders might need a basic course in stats, before giving stock tips.

altmind• 6 years ago

https://finviz.com/insidertrading.ashx

Show HN: Dashboard for tracking insider trading at S&P 500 companies

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