Short answer: not reliably. Since 2020, stocks bought by their own CEO or CFO beat the S&P 500 over the next 90 days 45.5% of the time (4,923 cases). Purchases by every other kind of insider beat it 45.9% of the time. The boss's money didn't make a difference.
That surprised us, because "the CEO is buying" is usually treated as the strongest insider signal there is. So here's exactly what we measured, and where the CEO signal did and didn't help.
What we measured
We took every open-market purchase (Form 4 code P, $10,000 or more) in U.S.-listed stocks from 2020 onward, from the SEC's insider data sets. Purchases in the same stock within 14 days count as one buy event, 16,899 events in all. For each, we compared the stock's price change over the 90 days after the filing became public with the S&P 500's over the same days.
| Who bought | Cases | Beat the S&P 500 | Median vs. S&P 500 |
|---|---|---|---|
| CEO or CFO involved | 4,923 | 45.5% | −1.9 pts |
| No CEO or CFO | 11,976 | 45.9% | −1.4 pts |
| CEO or CFO buying alone | 2,449 | 44.8% | −2.3 pts |
| CEO or CFO, $1M or more | 985 | 42.5% | −3.2 pts |
| All insider buys | 16,899 | 45.8% | −1.6 pts |
The bigger the CEO's purchase, the worse it did: CEO or CFO buys of $1 million or more beat the market only 42.5% of the time.
The stocks usually rose. Just not as much as the market
This is the part most headlines miss. After a CEO or CFO bought, the typical stock was up 2.8% 90 days later. That sounds fine until you compare it with the S&P 500 over the same days: the typical CEO buy trailed the index by 1.9 points.
The average tells a slightly different story (+0.2 points vs. the S&P 500) because a few very big winners pull it up. So a CEO buy is a bit like a lottery ticket with a slightly negative typical result and a long right tail.
Did it work better in some years?
Yes, and that's a warning sign rather than good news. Before April 2023, CEO and CFO buys beat the market 48.1% of the time. Since then: 43.2%. A signal that works in one stretch and fades in the next is more likely to be luck than an edge. (We split every finding this way; see how we test.)
Why might the CEO signal be weak?
We can only measure what happened, not why. A few possible reasons:
- CEOs often buy to reassure investors, for example after bad news or a falling share price. A purchase can be a message as much as a bet.
- Many CEO buys are small compared with what the CEO already owns or earns.
- Most insider buying happens in smaller companies, and small stocks as a group lagged the large companies that dominate the S&P 500 in several of these years.
What did slightly better
No group of insider buys reliably beat a coin flip. The groups with a CEO or CFO in them that came closest:
- 3 or more insiders, including the CEO or CFO, after the stock fell 20%+ in three months: 49.3% beat the market (531 cases).
- 2 insiders, including the CEO or CFO, with the stock up over three months: 48.8% (416 cases).
Both are still close to 50/50.
Try it yourself
- Filter CEO and CFO buys any way you like in the Backtester, including the before/after-2023 check.
- See how each current CEO purchase compares on the CEO and CFO buys page.
- Think you can spot the winners? Play today's Insider Call: five real buys, company hidden.
Data: SEC Form 4 filings and SEC insider transaction data sets, 2020 to October 2026. Price-only returns, no trading costs. Delisted stocks often drop out, which flatters these numbers a little. History, not a prediction, and not investment advice.