I’ve
received an e-mail from one of my readers. Here is what he wrote:
“Hi Tom
I also live on
passive income dividend stocks entirely for my daily expenses. I have a strict
criterion for the yield being at least 3%. My other requirements are:
1) Minimum
50,000 shares traded daily (liquidity)
2) 1 year
price performance equals or beats the S&P 500 (relative strength)
3) Recent
insider large block purchases within the last 6 months.
And, just to comment on your comment, I also do not care for small insider buys or option purchases. I only look for VERY LARGE BLOCKS of shares being bought with DIRECT PURCHASES on the market. This is very key to my criteria.
And, just to comment on your comment, I also do not care for small insider buys or option purchases. I only look for VERY LARGE BLOCKS of shares being bought with DIRECT PURCHASES on the market. This is very key to my criteria.
Yahoo.com finance page has a very good "insiders transaction" page on each stock symbol you wish to research. You can get 6 months of purchasing on the open market information complete with share price bought, number of shares, and dates of purchases. Very very good info.
The problem is that my watch list has about 500 stocks and so it can become quite laborious to manually look up all 500 stocks. I've done it before but takes about half day. The good news is that I can find some big blocks of high dividend stocks being bought just within price range so makes for time worth spent. The needle in the hay stack theory of investing. It only takes about 20 to 30 purchases to make up a nice passive income portfolio.
I consider insider purchases (again, ONLY big blocks bought on the open market within the last 6 months) very important because I am skeptical of the financial numbers that companies report to the public. Earnings and other fundamental data are easily fungible, ask any accountant worth his salt.
But two numbers are important to fudge: dividend payouts, and large insider buys on the open market. Just can't lie on those two data points. The other number that is not fungible is of course the historical price of the stock and volume traded.
So, thats why I base my passive income portfolio based on those four data points:
Yield, Relative Strength, volume and Large Open Market Insider buys.
If a website ever could deliver those four criteria it would have a nice following. Nobody is doing it.
I have been
doing my research manually for years because I cannot find a reliable free
stock screener that can fulfill these 4 criteria. www.finviz.com comes very
close but the insider transaction information is not reliable and it also
includes insider sales which skews the results.
Do you know of
any free stock screeners on the web that has at least two of the criteria;
dividend yield and recent insider purchases.
Funny, cause
the insider purchases screeners don't have yields and the yield screeners don't
have insider buys. Any ideas?
Thanks”
Well,
that’s a good question. I’m a bit more fundamental orientated and I don’t care
much about small insider buys and sells. If a managing director or a CEO
receives a $100 million share packet or options to buy or sell the companies
underlying assets, it’s every day possible that he throws away his shares
partly into market.
Well,
back to your question. A good tool with insider and guru buys and sells which
also includes the dividend yield is available on gurufocus.com. I use this
site personally to screen the recent guru activities. Here is a link to the
insider buy site on gurufocus.com.
If
you have any further questions, to not hesitate to contact me. If
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Happy
Investing!
Tom
Roberts