They say to never trust a skinny cook, the logic being that any chef who works in a kitchen all day and creates irresistible dishes probably can’t help but overindulge and pack on a few pounds. For much the same reason, I find it reassuring when a mutual fund manager invests their personal cash in his or her own fund. And I like it even better when CEOs and other top executives stash a sizable percentage of their net worth in their own company’s stock. Conventional wisdom says that it’s a bullish sign when a company invests in itself through… Read More
They say to never trust a skinny cook, the logic being that any chef who works in a kitchen all day and creates irresistible dishes probably can’t help but overindulge and pack on a few pounds. For much the same reason, I find it reassuring when a mutual fund manager invests their personal cash in his or her own fund. And I like it even better when CEOs and other top executives stash a sizable percentage of their net worth in their own company’s stock. Conventional wisdom says that it’s a bullish sign when a company invests in itself through stock buybacks. If that’s true (and in most cases it is), then what does it say when these same managers sink a few million dollars of their OWN money in the shares? After all, board members, directors, chairmen and other upper executives know the business and the industry better than anyone else. Who understands the inner workings of Apple (Nasdaq: AAPL) better than Tim Cook? Who has their finger on the pulse of online advertising quite like Google (Nasdaq: GOOG) boss Larry Page? These well-connected individuals also have access to privileged information that the rest of us don’t get to… Read More