The breakdown:
@KLoeffler didn’t personally make these trades. She has a blind trust, a 3rd party is solely responsible for managing her accounts and making trades. She wasn’t aware of the trades until after they were made. Violating this would be illegal and require evidence to
@KLoeffler didn’t personally make these trades. She has a blind trust, a 3rd party is solely responsible for managing her accounts and making trades. She wasn’t aware of the trades until after they were made. Violating this would be illegal and require evidence to
allege. Loeffler and her husband are likely worth more than $500M. Their trades should be viewed in context of that wealth. In a blind trust of this size, it would be expected that a manager would make frequent purchases and sales which look large to the average investor.
For insider trading, we should be looking for potential activity from insider information, involving lucrative trades to profit or avoid big losses. The closed briefing took place on Jan 24, so supposed inside trades should be close to that date, by mid Feb it wasn’t inside info.
The $18.7M comes from sales of Intercontinental Exchange stock. Loeffler is a former executive there, and her husband is the current CEO who gets stock options. The two large sales occurred on Mar 11, long after any inside information could be expected relating to the coronavirus
At the time, the stock already plummeted 14% from its highs earlier in the month, and only dropped another 5% after. Not particularly lucrative, and not related to inside knowledge of the virus, this could easily be explained by normal trading for a couple heavily invested there.
The retail stocks sold were quite minor. $56k of Lululemon and $70k of Ross Stores on Mar 2-3 and $27k of TJ Max on Mar 9. While these all fell afterwards, they had already fallen substantially before the sale and constituted a tiny portion of their portfolio. By early March,
most savvy investors would know that retailers would get hit hard by the crisis, and one would hope their blind trust manager would act accordingly.
The touted purchase of a “company making coronavirus protective gear” was not some fancy lucrative upstart, it was DuPont.
The touted purchase of a “company making coronavirus protective gear” was not some fancy lucrative upstart, it was DuPont.
Three purchases were made from Feb 28-Mar 3 totaling $194k. DuPont well known and makes practically everything. From clothing to adhesives to chemicals to medical supplies. While it might be a potentially good buy in this environment, the trade was fairly small and has lost 25%!
Additionally, other trades don’t appear to be particularly insider-like. They sold $180k in DocuSign on Feb 20, a company which should fare quite well in this environment. They also sold Facebook, which would likely benefit from the virus keeping everyone glued to social media.
None of these trades look particularly lucrative or significant, and most occurred many weeks after the briefing. Considering she has a blind trust making her investments, there is still no evidence of wrongdoing here and it seems unlikely she would risk so much to gain so little
