Corporate executives might sell stocks for a variety of reasons. But company executives usually purchase their own stock for one reason – because they expect prices to rise.

Over the last 12 months every sector of the stock market has witnessed a significant increase in net insider selling; there isn’t a single sector of the market that’s been supported by net purchases.

Insiders might sell shares because of personal financial reasons, including liquidity concerns or to fund college or housing requirements. But when it comes to making purchases of their own company stock, insiders are usually bullish about the near-term prospects of company earnings and therefore make substantial purchases ahead of an earnings recovery.

Though not an exact science, historical evidence on insider buying shows the biggest moves in a company’s stock occurs amid “clustered” buying, or when several executives purchase stock around the same time at approximately the same price.

Insiders or corporate executives at American companies who purchase or sell their own shares recently purchased the smallest amount of stock since July 1992 at just $42.5 million dollars. That’s the lowest amount for a full month since July 1992.

CEOs, CFOs and directors of America’s publicly traded companies must file with the Securities and Exchange Commission (SEC) every time a transaction occurs. Failure to file can result in punitive charges or insider trading violations.

Historically, insider sales have been a poor barometer of future stock price activity while insider purchases have been far more telling. Yet the level of selling is worrisome this year because of its ratio to purchases.

According to Washington Service, U.S. executives sold $353 million dollars’ worth of equities in April or 8.3 times more than they purchased. That’s the fastest rate of selling since October 2007 just ahead of a peak in stock prices.

U.S. corporate earnings have contracted for seven straight quarters – the longest stretch of declines in more than 70 years.