Company executives are hurriedly buying up shares in their own firms as the current market volatility apparently leaves them undervalued.
That is according to Investec Private Bank (Investec), which says the number of senior executives borrowing money for this purpose is up 30% from this time last month.
Investec, which lends to directors and big investors for a number of reasons including to boost liquidity without selling equity, adds 80% of calls received from executives in August related to borrowing money to buy up shares.
Spokesman David Drewienka says: “From our experience, it would appear that many executives believe that their companies are currently under-valued and that the current stock market volatility represents a good opportunity to purchase more shares.”
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