Question 1

Is this legal?

Accepted Answer

Yes, completely. Corporate insiders (CEOs, CFOs, and other senior executives) are legally required to report their personal stock purchases to the SEC within 48 hours of the transaction. This information is public record, freely available on the SEC's EDGAR database. InsiderIQ reads those public filings and filters them algorithmically. Subscribing to and acting on publicly disclosed insider purchase data is legal for retail investors. This is distinct from illegal insider trading, which involves trading on material non-public information before it's disclosed.

Question 2

What's the difference between this and illegal insider trading?

Accepted Answer

Illegal insider trading means trading on information that has not yet been disclosed to the public, a CEO buying stock because they know an acquisition is about to be announced, before anyone else knows. That's illegal. What InsiderIQ tracks is the opposite: purchases that have already been disclosed publicly through mandatory SEC filings. The insider already bought. The filing is public. We're just making sure you see it quickly and know which ones historically matter.

Question 3

Why do insider purchases predict stock performance?

Accepted Answer

Corporate insiders have legal access to non-public information about their company's prospects: revenue trends, pipeline deals, competitive dynamics, product performance. When a CEO spends their own money buying stock on the open market, it's one of the strongest possible signals of personal confidence in the company's future. Academic research going back to the 1980s ([Seyhun 1986](https://doi.org/10.1016/0304-405X(86)90060-7), [Lakonishok & Lee 2001](https://doi.org/10.1093/rfs/14.1.79)) consistently documents 2–4% excess returns following insider purchases. Our five-factor filter isolates the purchases that show the strongest historical signal, nearly doubling that benchmark.

Question 4

How is InsiderIQ different from just checking SEC.gov or OpenInsider?

Accepted Answer

You could check EDGAR directly, the data is public. The difference is signal-to-noise ratio. Corporate insiders file thousands of Form 4s every week covering sales, option exercises, grant vestings, and automatic 10b5-1 plan purchases. Raw insider data is roughly 96% noise. InsiderIQ's algorithm runs every filing through five filters and alerts you only when all five pass, about 4% of all filings. We then validate every alert against six years of historical data so you know exactly what the hit rate and average alpha of qualifying signals has been. OpenInsider shows you everything. We show you what the backtest says matters.

Question 5

What are the five filters?

Accepted Answer

A signal qualifies only when all five conditions are met: C-suite title: CEO, CFO, COO, President, board Director, or comparable executive role (VP-tier roles are excluded) Open-market purchase: not a grant, option exercise, or automatic plan No 10b5-1 pre-scheduled trading plan: the purchase is discretionary Transaction value between $25,000 and $999,999: large enough to signal real conviction, small enough to exclude megabuys that our backtest shows underperform Purchase price not within 30% of the 52-week low: filters out "falling knife" situations where insiders average into losing positions Cluster bonus (+1, cap 10): separate from those five gates, the model adds one point when three or more distinct insiders at the same company have qualifying open-market purchases within a rolling 7-day window. That bonus is judged at scoring time for each filing. Early buys in a forming cluster are often still 9/10; a later filing scored after the cluster is visible can reach 10/10. Older alerts are not rescored when new insiders file. The Clustered buying strip on the subscriber dashboard summarizes recent multi-insider activity by ticker; it can show a cluster even when an individual alert in the list still shows 9/10 from when that trade was first scored.

Question 6

What extra context do I get with an alert?

Accepted Answer

Beyond the five backtested filters, every alert and your dashboard include a few context layers that aren't part of the historical scoring claim — they're surfaced live to help you read the trade in context, not to inflate the headline number. Earnings timing: the next reported earnings date (from a third-party feed, marked as estimate) plus an approximate days-to-blackout label using a 21-day default. Issuer policies vary; this is context, not a deterministic blackout calculation. Listed-options activity (F8): when the underlying options chain shows unusual call activity (volume skewed to OTM / medium-dated maturities) at filing time, we surface that as a +1 confluence flag in the live alert. F8 is live-dispatch only, it is not part of the six-factor backtest. Sector heat map: a 30-day GICS-style rollup of recent qualifying alerts, viewable on the dashboard. Aggregate view of where insider buying is concentrated, not a personal recommendation. 30-day price sparklines: a small inline chart on each signal row showing how the stock has tracked since the filing. Cache-only; gracefully hidden when price data is unavailable.

Question 7

What does your backtest actually show?

Accepted Answer

Across 11,434 qualifying signals from 2020–2025 (6 years), signals that passed all five filters averaged +5.7% alpha versus the S&P 500 at the 90-day holding window, with a 57.7% hit rate. That means roughly 58% of qualifying signals outperformed the benchmark over 90 days. Fama-French factor analysis confirms the alpha is statistically significant (t = 7.11, well above the 2.0 threshold) — it is unlikely to be noise. One caveat: our signals have a meaningful small-cap tilt (β_smb = +1.36), since insider purchases in the $25K–$999K range naturally skew toward smaller companies. A portion of the returns reflects the historical small-cap size premium rather than pure stock-picking. These figures are hypothetical and calculated without transaction costs or slippage. Past performance does not guarantee future results. Live signal performance, with actual 30, 60, and 90-day returns tracked as windows close, is available in the subscriber dashboard.

Question 8

The backtest cites 1,400+ tickers, but aren't there 6,000+ U.S.-listed stocks?

Accepted Answer

Those figures answer different questions. Roughly 6,000+ symbols is often cited as the scale of the broad U.S. equity market (the exact number changes with listings, delistings, ADRs, and how you draw the boundary). The 1,400+ tickers in our backtest materials is not saying only that many stocks were "available" while the rest were excluded from the market. It is the count of distinct issuers that actually appeared in our historical dataset over the backtest window as companies where insider purchase activity flowed through our pipeline and met the conditions we measure. Most listed names never appear in that count because discretionary open-market purchases by senior insiders that pass our filters are uncommon relative to the full listing base. Many firms have no qualifying buy in a given stretch of time, or only filings we deliberately exclude (automatic 10b5-1 plans, grants, sales, and so on). So the number of tickers in the backtest is much smaller than "every U.S. listing", not because we cap coverage at 1,400, but because the analysis follows where those insider purchases actually occurred under SEC disclosure. InsiderIQ does not maintain a fixed watchlist of every U.S. stock. We process Form 4 filings as they hit EDGAR. The empirical universe of the backtest reflects SEC filing activity, not an attempt to span every symbol in a theoretical investable index.

Question 9

How quickly do alerts arrive after a filing?

Accepted Answer

SEC rules require insiders to file within 48 hours of a transaction. InsiderIQ polls the EDGAR RSS feed continuously and typically delivers alerts within 15–30 minutes of a new Form 4 appearing. On average we send approximately 12 qualifying alerts per week, though the cadence varies, insider buying tends to cluster after earnings blackout periods lift.

Question 10

Is this investment advice?

Accepted Answer

No. InsiderIQ is an information service. We surface publicly available SEC filing data filtered through a quantitative algorithm. We do not know your financial situation, risk tolerance, or investment objectives. Nothing we send constitutes a recommendation to buy or sell any security. Always conduct your own research and consult a licensed financial advisor before making investment decisions.

Question 11

I work at a financial institution. Can I use this?

Accepted Answer

Possibly, but you should check with your compliance department first. Many financial institutions have pre-clearance requirements for personal trading and may have policies about the use of third-party signal services. InsiderIQ does not provide compliance advice. The data we surface is public, but your firm's internal policies govern how you may act on it.

Question 12

What's coming next?

Accepted Answer

The subscriber dashboard is already live. It includes a scorecard with live performance vs. the backtest figures, a watchlist so you can filter alerts to companies you already follow, a weekly digest showing how past signals are performing at 30/60/90 days, earnings calendar context at dispatch, F8 listed-options confluence on live alerts, and a sector heat map. On the roadmap: Institutional position monitoring that tracks when major funds quietly build positions in stocks you follow, powered by 13-F quarterly holdings disclosures. You'll see how institutional stakes evolve over time alongside your insider alerts. Longer term we're building SEC Filing Radar to extend that filing intelligence to 8-Ks, S-1 amendments, and other material events for your watchlist, plain-English alerts ranked by materiality, not a wall of legalese. The 13-F slice above is the first piece of that roadmap.

Question 13

How do I unsubscribe?

Accepted Answer

Every email we send includes an unsubscribe link in the footer. One click and you're removed immediately. No confirmation email, no dark patterns. You can also email alerts@insideriq.co and we'll remove you manually within 24 hours.

Frequently Asked Questions