European Insider Buying After Market Declines: Evidence From 13,000+ Transactions Across 15 Markets

InsidersAlpha Research Team

1. Dataset Overview

The dataset comprises insider transaction filings collected from official regulatory and exchange disclosure sources across 16 markets, of which 15 are included in this analysis (see Section 4).

Note: Switzerland is tracked by InsidersAlpha but excluded from this analysis. Swiss filings do not identify individual insiders by name, so transactions cannot be attributed to a specific person.

Note: Austria and Singapore were added to InsidersAlpha's coverage after this research was conducted and are not reflected in the dataset, methodology, or findings above.

2. Data and Methodology

2.1 Data Provenance

This research uses publicly disclosed insider transaction filings collected from the official regulatory and exchange sources listed in Table 1. Transactions were processed and standardized internally before analysis. No third-party data vendors or aggregators were used to source the underlying filings.

2.2 MAR Article 19 Background

Article 19 of the EU Market Abuse Regulation (Regulation (EU) No 596/2014) requires persons discharging managerial responsibilities (PDMRs) — directors, executives, and certain senior managers — and persons closely associated with them, to disclose transactions in their company's securities once the aggregate amount reaches €5,000 within a calendar year. Disclosure must occur promptly and no later than three business days after the transaction (the "T+3" requirement). The regulation applies uniformly across EU and EEA member states and has been adopted in equivalent form by the United Kingdom following its post-Brexit onshoring of MAR.

Because Article 19 imposes standardized disclosure content and timing across jurisdictions, it provides a comparatively consistent basis for cross-market analysis relative to relying on voluntary or heterogeneous national disclosure regimes. South Korea, while outside the MAR framework, maintains a comparable mandatory disclosure regime for major shareholders and executives through the Financial Supervisory Service's DART system, which we include on that basis.

2.3 Transaction Filters

2.4 Return Measurement

• Returns are measured from the closing price on the transaction date at 30-, 90-, and 180-day horizons.
• Transaction values are normalized to EUR for cross-market comparison.
• No market or factor adjustment is applied to returns; all figures reported are raw price returns. This is a limitation, discussed in Section 8.

3. Research Questions

This analysis examines five questions:

1. Are insider purchases in European markets associated with above-random subsequent returns?
2. Does purchase timing relative to recent price performance affect observed outcomes?
3. Are concurrent purchases by multiple insiders at the same company associated with different outcomes than purchases by a single insider?
4. Does transaction size affect observed outcomes?
5. Can mean reversion account for the association observed between price-decline purchases and subsequent returns?

4. Summary of Findings

All figures reflect a single query against the underlying database taken at time of writing (July 2026). Because the dataset is updated daily, figures reported in future analyses drawing on the same underlying data may differ modestly.

5. Findings

6. Supplementary Drawdown Comparison

To assess whether the association between price-decline purchases and subsequent returns (Finding 2) reflects insider-specific information or simple mean reversion, we conducted a supplementary drawdown comparison. This is not a controlled experiment in the clinical-trial sense of the term — it is an observational comparison against an independently constructed reference group, and we describe it as such throughout.

The underlying transaction database cannot support this comparison alone: it contains only rows where an insider transaction occurred, so no group of "drawdown periods without an insider purchase" exists within it. To construct one, we drew on an external data source. For each of the 447 tickers with at least one price-decline purchase in the dataset, we obtained two years of daily closing prices from Yahoo Finance and independently identified every period where the same 10-60% drawdown definition used to characterize the original purchases was met, irrespective of insider activity. Periods within 30 days of an actual insider purchase for that ticker were excluded, leaving a sample of drawdown periods with no proximate insider buying. Forward returns from these dates were then measured using the same methodology (closing-price basis, 30- and 90-day horizons, identical outlier thresholds) applied to the original price-decline purchase group. To avoid treating each trading day of a single multi-week drawdown as an independent observation, one observation was sampled per contiguous drawdown episode rather than per day.

The comparison group's win rate (48.0% at 30 days, 49.3% at 90 days) is close to what would be expected under a random outcome, suggesting that a drawdown alone, without an accompanying insider purchase, is not associated with a subsequent recovery in this dataset. The observed difference between the two groups is consistent with the possibility that the association documented in Finding 2 reflects something specific to the insider purchase rather than a general property of drawdowns.

This comparison has several limitations that should be considered before drawing conclusions from it:

• It is not a matched-pair experiment. Observations were not paired by date, sector, market capitalization, or volatility regime.
• The comparison group is limited to tickers where insiders were active at some point during the sample period (i.e., tickers with at least one price-decline purchase already in the dataset). This is not a random sample of all listed companies and may introduce selection bias in either direction.
• Both groups draw from overlapping but not identical time periods within the same approximately two-year window.
• The finding is suggestive, not conclusive, and has not been subjected to formal statistical hypothesis testing.

7. Literature Context

Academic research on insider trading generally documents positive associations between insider purchases and subsequent returns, though findings vary by market, methodology, and transaction type. Seyhun (1986) examined U.S. insider transactions using SEC filings and found that insider trading activity was associated with subsequent abnormal returns, with the magnitude varying by firm size and the extent of insider selling or buying. Lakonishok and Lee (2001) found that insider purchases carried stronger associations with subsequent returns than insider sales, and that the association was more pronounced among smaller firms. Jeng, Metrick, and Zeckhauser (2003), using a portfolio-based performance-evaluation approach, estimated that a portfolio mimicking insider purchases would have generated abnormal returns of approximately 6% per year using a standard multi-factor benchmark.

European research on this topic is less extensive than the corresponding U.S. literature. MAR Article 19, which standardized insider disclosure requirements across EU member states, was introduced in 2016, meaningfully limiting the length of the historical dataset available for European studies relative to U.S. research drawing on SEC Form 4 data extending back to the 1970s. Findings in this analysis should not be extrapolated beyond the covered time period, nor interpreted as confirming or replicating prior academic results, given differences in methodology, market coverage, disclosure regime, and time horizon between this analysis and the cited literature.

• Seyhun, H.N. (1986). "Insiders' Profits, Costs of Trading, and Market Efficiency." Journal of Financial Economics, 16(2), 189-212.
• Lakonishok, J., & Lee, I. (2001). "Are Insider Trades Informative?" The Review of Financial Studies, 14(1), 79-111.
• Jeng, L.A., Metrick, A., & Zeckhauser, R. (2003). "Estimating the Returns to Insider Trading: A Performance-Evaluation Perspective." The Review of Economics and Statistics, 85(2), 453-471.

8. How to Interpret These Results

• Correlation does not imply causation. An observed association between a purchase characteristic and subsequent returns does not establish that the characteristic causes those returns.
• Insiders purchase for reasons beyond information advantage. Tax planning, estate planning, portfolio diversification, communicating confidence to the market, and contractual or compensation-related requirements can all motivate a purchase independent of any private assessment of the company's prospects.
• Selection bias. The dataset covers only companies that had at least one insider transaction filing during the sample period. This is not a random sample of listed companies and may not generalize to companies without recorded insider activity.
• Single time period. The sample period (October 2025 - July 2026) does not include a full market cycle, and in particular does not include a sustained market downturn.
• No risk adjustment. Reported returns are raw price returns, not adjusted for market, sector, size, or other common risk factors. This may overstate the association relative to a risk-adjusted benchmark.
• Historical associations may not persist. Relationships documented in this dataset reflect the specific period and market conditions studied and may not hold in other periods.

9. Limitations

10. Potential Extensions

Potential extensions of this analysis include:

• Market-adjusted and factor-adjusted returns (e.g., Fama-French three-factor or five-factor models).
• Sector-adjusted analysis.
• Country-specific breakdowns.
• A longer historical sample period, incorporating data preceding October 2025.
• Out-of-sample validation on a subsequent, non-overlapping period.
• A matched-pair comparison-group methodology (matching by sector, market capitalization, and date) in place of the unmatched comparison used in Section 6.
• Explicit controls for liquidity and market capitalization.

11. Data Provenance

This analysis is based on publicly disclosed regulatory and exchange filings collected directly from the official sources listed in Table 1. Data collection, processing, and analysis were conducted independently by InsidersAlpha. The underlying transaction database is updated daily and, for the purposes of this analysis, covers filings from October 2025 onward.

The transaction data underlying this research is available at InsidersAlpha.com.