Should you trust directors’ judgement?

We might be heading for a stockmarket collapse, but company directors have bought up £54m of their own shares in the first six months of 2008. So do they know something we don’t?

We might be heading for a stockmarket collapse, but it seems no one told the management of Britain's listed companies. Directors have bought up a total of £54m of their own shares in the first six months of this year, compared with £65m for the whole of 2006.

So do they know something we don't? After all, "insiders' behaviour is predictive", says Nejat Seyhun, a finance professor at the University of Michigan. Yet had you done exactly as three of the biggest spenders over the past year Frits Seegers, head of global retail banking at Barclays; Andy Hornsby, CEO at HBoS; and Charles Dunstone, founder of Carphone Warehouse and a non-executive director at HBoS, you would be down around £1.1m, or about 41%.

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Tim graduated with a history degree from Cambridge University in 1989 and, after a year of travelling, joined the financial services firm Ernst and Young in 1990, qualifying as a chartered accountant in 1994.

He then moved into financial markets training, designing and running a variety of courses at graduate level and beyond for a range of organisations including the Securities and Investment Institute and UBS. He joined MoneyWeek in 2007.