Recently, reports about cashing out by American business leaders have stirred the nerves of investors. It has reached its peak when the CEOs of $Tesla (TSLA.US)$and $Microsoft (MSFT.US)$ started selling their stock while their company's stock prices were hovering near new records.
$Microsoft (MSFT.US)$ Chief Executive Satya Nadella sold about half of his shares in the company last week, reported by Wall Street Journal on Nov. 29.
The filing of Mr. Nadella’s transaction was made public on the Wednesday before the long Thanksgiving weekend. The transaction yielded more than $285 million for Mr. Nadella. This is the single-largest stock sale for Mr. Nadella, according to InsiderScore.
How did the market react?
Interestingly, MSFT has fallen 2% since LAST Wednesday, while $S&P 500 Index (.SPX.US)$ has fallen 2.64% over the same period.
Ben Silverman, director of research at InsiderScore, said the sale is similar to Tesla CEO Elon Musk's recent stock sales. Mr. Musk took to Twitter on Nov. 7 pledging to sell 10% of his stockholdings. The Tesla CEO was taking advantage of gains in the company’s stock price, Mr. Silverman said.
$Tesla (TSLA.US)$'s stock price has fallen by about 7%, and its market value has shrunk by nearly $100 billion from that point.
Does CEOs’ sell-off mean it’s time to sell?
Action speaks louder than words. Of course, the behavior of business leaders will affect investors' confidence in the company. At least, for better or worse, news usually makes stocks more volatile in the short term.
However, their actions are not always noteworthy.
For one thing, insiders may have their own reason each time they sell stock. As to Nadella, analysts said the move could be related to Washington state instituting a 7% tax for long-term capital gains beginning at the start of next year for anything exceeding $250,000 a year.
For another, insider trading shouldn't be the only source of information, because not every executive is correct each time. In the long run, the best option is to research in-depth.
News about the sale of stocks by executives is reported from time to time. To paint a clearer picture of their effects, let's check the performance of markets and those stocks:
1. The broad market has continuously set new highs since the pandemic.
2. Taking Amazon as an example, after the CEO sold shares, the stock price has still climbed higher.
The same story also applies to $Pfizer (PFE.US)$, whose CEO sold stocks last November.
3. It's not all good news.   $GameStop (GME.US)$ CEO announced to sell stocks in April. Here is how the stock price performed since then.
The bottom line
1. The CEO's sell-off may help you predict the future volatility of stock prices in the short term.
2. There is no obvious correlation between long-term stock performance and CEO selling.
3. Insider trading should not be the only source of information. Before making wise investment decisions, we should rely on in-depth research to check the company’s financial statements, annual reports, and other public opinions.
As a rule, value investors generally prefer to invest in high-quality companies with fair prices. The question is, how to identify the value of a company?
Click to our newly unveiled courses: How to invest in stocks: Quick-Start Guide.
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$S&P 500 Index (.SPX.US)$ $Dow Jones Industrial Average (.DJI.US)$ $Nasdaq Composite Index (.IXIC.US)$

Stocks face pressure from virus, taper; Oil falls
Stocks looked set to fall Monday on concerns about European Covid-19 curbs and the risk of a faster withdrawal of Federal Reserve stimulus. The Treasury yield curve was near the flattest since the pandemic's onset.
Shares fell in Australia as did equity futures for Japan and Hong Kong, while U.S. contracts edged up. Sectors sensitive to the economic outlook led the $S&P 500 Index (.SPX.US)$ lower Friday, while the technology-heavy $NASDAQ 100 Index (.NDX.US)$ outperformed in an echo of the stay-at-home trade.
Global IPOs blow past $600 billion mark in best year on record
Global initial public offerings have smashed their previous record this year, propelled by a blank-check boom and companies cashing in on high valuations.
With six weeks to go, about 2,850 businesses and special purpose acquisition companies have raised more than $600 billion in IPOs, leaving the records for both deal count and proceeds reached in 2007 in the dust, according to data compiled by Bloomberg.
El Salvador plans tokenized bitcoin bonds and tax-free 'bitcoin city'
El Salvador intends to issue the world's first sovereign Bitcoin bonds and build Bitcoin City, which will be free of income, property and capital gains taxes, President Nayib Bukele announced in the beach town of Mizata to a crowd of cheering Bitcoin enthusiasts.
El Salvador plans to issue $1 billion in tokenized U.S.-dollar denominated 10-year bonds to pay 6.5% via the Liquid Network, according to Samson Mow, chief strategy officer of blockstream.
Self-driving stocks join EVs as next retail trader obsession
Self-driving technology companies are the latest automotive stocks to become an obsession of retail traders, with firms like $Aurora Innovation (AUR.US)$ surging Friday on high volume.
The stock is now up 71% this week. While Aurora's advance was the most stark, other stocks also rose sharply. $TuSimple (TSP.US)$, which makes self-driving technology for heavy-duty and semi trucks, gained as much as 7.9% before closing up 5.9%.
Market is 'one more bad inflation report' away from a correction, Wharton's Jeremy Siegel warns
Long-term market bull Jeremy Siegel expects a serious pullback that it isn't tied to the Covid-19 surge risks.
"If the Fed suddenly gets tougher, I'm not sure that the market is going to be ready for a U-turn that [chair] Jerome Powell may take if we have one more bad inflation report," the Wharton finance professor told CNBC on Friday. "A correction will come."
Rocket builder Astra reaches orbit for the first time
$Astra Space (ASTR.US)$ reached orbit for the first time with rocket LV0007 on Saturday. Astra joins SpaceX, $Rocket Lab (RKLB.US)$ and $Virgin Galactic (SPCE.US)$ in the group of U.S. companies that have reached orbit with a privately-funded rocket.
The company's rocket is 43 feet tall and fits in the small rocket segment of the launch market. Astra's goal is to eventually launch as many of its small rockets as it can, aiming to launch one rocket a day by 2025 and drop its $2.5 million price point even further.
Levi Strauss CEO expects strong holiday sales as Americans unleash pent-up demand
"We're expecting a really strong holiday season, and it’s all being fueled by a super-strong consumer right now," $Levi Strauss & Co. (LEVI.US)$ CEO Chip Bergh told CNBC. "The home balance sheet has probably not been stronger than this in a real long time," Bergh said in an interview that aired Friday on "Mad Money."
Nvidia CEO says the metaverse could save companies billions of dollars in the real world
$NVIDIA (NVDA.US)$ CEO Jensen Huang told CNBC on Friday that running simulations in the metaverse can deliver real-world benefits to corporations. Huang said that’s why companies are willing to invest in the creation of virtual reality universes.
"We waste a whole bunch of things to overcompensate for the fact that we don't simulate," he said.
Source: Bloomberg, WSJ, CNBC

$Goldman Sachs (GS.US)$ good

$Goldman Sachs (GS.US)$ Has been doing a whole lot of nothing for a while

$Tesla (TSLA.US)$shares hit a record high of $1,243.49 per share on Thursday.
Who is selling Tesla stock?
Popular money manager Cathie Wood's investment firm Ark Invest sold more shares in Tesla, and including the latest sale Ark Invest has sold about $1.44 billion worth of shares in Tesla since the start of September.
Tesla board chair Robyn Denholm exercised options to 25,000 shares on Monday, sold all of the stocks on the same day. His options would expire in June next year, were exercised at $52.38 per share, sold at up to $1,147.3 each.
Is it a good time to short Tesla?
Tesla is now up a whopping 52% in the past month, adding about $400 billion to its market cap. The extreme move comes after a 2 billion deal to sell 1,000 Model 3 to $Hertz Global Holdings, Inc. (HTZZ.US)$.
DataTrek Research co-founder Nicholas Colas said it's understandable that short sellers may see an opportunity to short Tesla stock after its extreme move higher.
In fact, Tela has outperformed the S&P 500 by about 77% in the past 100 days, a performance that may seem like an opportunity for a mean reversion trade at first glance.
Don't short Tesla here. Crazy as it sounds, the stock's recent rally is pretty normal action for this name.”
—— Colas said in a Tuesday note
Traders' movements in Oct. showed that Tesla's rally isn't over: click here.
Mooers, do you think whether or not Tesla stock is too expensive now?

Kobe Bryant, the late NBA legend, was not just a basketball player.
One of his big investments paid off big time. In 2014, Bryant purchased 10% of BodyArmor, a Gatorade competitor, for $6 million.
Last week, $Coca-Cola (KO.US)$ announced it acquired full ownership of BodyArmor, paying $5.6 billion in cash, valuing BodyArmor around $8 billion. The company had purchased a minority stake in 2018.
With that valuation, Bryant's 10% investment is estimated to be worth around $800 million today. That puts his returns from $6 million to $800 million around a 13,222% gain in less than eight years. 
He still amazed us after he left.
Mamba Forever!