A good many investors keep a sharp eye on how corporate insiders are buying and selling their company stock. Corporate officers, directors and large shareholders apparently have a fairly good track record of correctly forecasting the market’s direction. Question is, given their recent not so terrific performance, are they still worth following?

“While these insiders have a long history of correctly anticipating the market’s direction, they haven’t done all that well in the last few years. As a group, insiders failed to recognize the top of the bull market in October 2007, and didn’t anticipate the depth of the decline that followed,” comments Mark Hulbert, editor of The Hulbert Financial Digest, a service of MarketWatch, in The New York Times.

Hulbert cites H. Nejat Seyhun, a finance professor at the Stephen M. Ross School of Business at the University of Michigan, who has studied the behavior of corporate insiders. Professor Seyhun believes that insiders often get it wrong in trying to anticipate the market’s direction.

But insiders have been correct far more often than they’ve been wrong, and this is still likely to be the case, according to Seyhun.

“Though the professor’s analysis extends only through 2008, data collected by the Vickers Weekly Insider Report show that even though the insiders missed the bear market, they can nevertheless take credit for anticipating the market rebound that began a year ago, “ observes Hulbert.“Leading up to the market’s low in March 2009, for example, insiders as a group behaved more bullishly than they had in more than a decade.”