Sitting members of the United States Congress trading individual stocks has become a contentious topic, in a manner of speaking.
Although it is universally considered by the public to be at odds with the oaths of office representatives and senators have to take, efforts to curtail or effectively regulate the practice have had lackluster results. The STOCK Act, passed in 2012, is violated on a regular basis without any meaningful repercussion — and even the proposed ETHICS Act is considered by many to be an anemic half-measure.
While readers are more than likely aware of some of the more prolific congressional stock traders, like Nancy Pelosi, Tommy Tuberville, or Josh Gottheimer, the practice is quite widespread. The core of the issue is one of ethics — public servants at that level of government routinely have access to information that the public is not privy to — information that, more often than not, moves markets.
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And the proof is in the pudding — members of Congress routinely outperform their constituents by a large margin. In one such instance, Tina Smith, the junior United States Senator from Minnesota, made quite the suspicious trade on November 12, per data from Finbold’s Senatorial Trading Radar.
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Senator Smith invested $100,000 in this little-known stock
The November 12 transaction was made public in a November 21 disclosure, which revealed that the senator purchased between $50,001 and $100,000 in Tactile Systems (NASDAQ: TCMD) stock.
This wasn’t the first time that Smith invested in TCMD shares — she had previously done so in November of 2023, as well as on March 11 this year. To be more precise, this trade was made by Senator Smith’s husband, Archie — an independent investor who largely focuses on healthcare companies.
At press time, TCMD shares were trading at $15.94 — they’ve experienced a minor 1.21% increase in price since the Senator’s purchase, bringing year-to-date (YTD) gains to 11.94%.
Since her original November 2023 purchase, however, which was also larger, valued at $100,001 to $250,000, TCMD stock has risen by 23.56%.
Here’s where things get interesting, or at the very least rather convenient. Tactile Systems is a healthcare company — and a relatively small one, at that. TCMD is a small-cap stock, with a market capitalization of just $382 million. Senator Tina Smith currently serves on the Senate Committee on Health. The business is also based in Minnesota — her home state.
Featured image via Shutterstock
