Insider Trading Signals Across Industries: Evidence from Technology, Utilities, and Banking

This paper examines how the predictive content of insider trading varies across industries. Using U.S. insider transaction data from 2005 to 2025 and firm-month level measures of insider trading and forward returns, we compare technology, banking, and utility firms within a unified framework. The results show that insider purchases in banking firms contain the strongest information about future returns, while the signal is substantially weaker in technology firms and moderate in utilities. We also document a clear asymmetry between buying and selling. Insider purchases are more informative than sales, while sales reflect more heterogeneous motives and are therefore harder to interpret. This buy–sell gap varies across industries and is most pronounced in banking and utilities. Finally, we compare insider-trading informativeness before and after the 2022 amendments to Rule 10b5-1. The results show that sell-side informativeness appears weaker in the post-2023 period, while the predictive content of purchases remains largely unchanged. This evidence is descriptive and does not imply a causal effect of the reform. Overall, the findings highlight the importance of industry-specific information environments and regulatory conditions in shaping the relation between insider trading and future stock returns.