Alpha Buying: Insider Activity Dwindles Despite Notable Buys from Top Execs

Taking a look at insider buying this week, we see that insiders are just as cautious and uncertain as the rest of us. The insider buy-sell ratio has moved to levels that are typically bearish, meaning that many more insiders are selling than buying.

 Now, that is not necessarily a disaster. Insiders sell stock for all sorts of reasons—estate planning, buying a house, funding a dream wedding or an Ivy League education, or, in some cases, a dream divorce.

But there is only one reason an insider buys: they think their stock is going to move a lot higher.

Right now, the lack of insider buying suggests they are not feeling overly confident about the market's long-term upside. And let's be honest, the broader market indicators aren't giving us any warm fuzzies either. Market cap to GDP, the Buffett Indicator, is sitting at historic highs. The overall allocation to equities among pensions, individuals, and institutions is near peak levels, a setup that historically leads to anemic returns over the next decade.

The excess CAPE yield, which compares corporate cash flows to Treasury yields, is flashing warning signs with a spread that screams, “proceed with caution.”

A lost decade is not out of the question. That does not mean an outright crash, though. It could take many forms: a brutal meltdown and a slow recovery, a melt-up followed by a grinding pullback, or just a long, ugly period of sideways action. The market has been running hot since 2009, and it has weathered a few hiccups—2018 and COVID—but each time, the Fed stepped in and bailed everyone out. That kind of intervention cannot last forever.

Then there is the extreme market concentration. Most of the recent gains are coming from a small handful of stocks. The last time the market was this narrow? 1998-1999. Before that? The Nifty Fifty era of the 1970s. Neither ended well. Do the math.

So, where is the smart money going during these turbulent times?

That brings us to Tom Gayner at Markel MKL.

Markel is not your typical insurance company.

 It's a specialty insurer, covering everything from marine and aviation to professional liability and even horse insurance,. It seems in addition to specialty property and liability coverages they also insure racehorses, show horses, and livestock.  That even includes major medical insurance for horses

The business is well-run and highly profitable. Gayner, who took the reins in 1990, has transformed it from a $40 million outfit into an $18 billion powerhouse.

His investment track record is nothing short of spectacular, crushing the S&P 500 over multiple decades. Recently, he made two separate six-figure stock purchases—one in November, another in early February. That kind of move from a guy with his track record should make you sit up and take notice.

Markel is not just about insurance. It also runs an investment portfolio that mirrors the Berkshire Hathaway model, with a strong emphasis on long-term, value-driven stock picks. The firm's portfolio includes major stakes in companies like Berkshire Hathaway BRK, Google GOOGL, Brookfield BN, Amazon AMZN, John Deere DE, Home Depot HD, Visa (Ticker: V), AppleAAPL, and Watsco WSC,a top-tier HVAC distributor generating impressive cash flow.

More recently, they have been buying Franco-Nevada, a gold royalty company, and Hagerty Insurance, which specializes in classic car coverage. They have also added Airbnb, Dollar General, and Insperity, a staffing solutions provider. The investment strategy is built on high-quality businesses with strong cash flow, and Markel's ability to generate returns has been exceptional over time.

Another name that caught my eye? Amcor PLC AMCR. It is a UK-based packaging and container company specializing in medical and consumer goods packaging. They are in the process of acquiring Berry Global, which will significantly boost their market position.

The stock is cheap, trading at just $10 per share with a solid 5% dividend yield. The CEO just snapped up another $1 million worth of stock, increasing his stake by over 30%. When the guy running the show puts that kind of money on the table, you should pay attention.

And for those of you still swiping left and right, Match Group MTCH insiders are making a move. Match owns all the big names in online dating—Tinder, Hinge, OkCupid, Plenty of Fish, and even some niche brands. The CEO just bought $2 million worth of stock, and a director stepped up with a six-figure buy.

This business has high gross margins, strong cash flow, and solid projected earnings growth for 2025. Wall Street loves it, and now the people at the top are backing it with their own cash.

So what is the takeaway? The overall market looks sketchy. Insiders are not exactly lining up to buy, which is a big red flag. But when the few who are buying happen to be seasoned, successful executives with a history of making smart bets, it is worth following their lead. Keep your eyes on Markel, Amcor, and Match Group.

These insiders are not waiting for permission. They are backing their convictions with real money. That is the kind of move you want to watch in times like these.