INSIDER TRADING: INSIGHT INTO “BOOKMAKER” SIGNALS TO DETERMINE FUTURE STOCK PRICE TRENDS

A move by Mawun that caused Alibaba's $2 billion market value to drop nearly 10% within a day, evaporating $2 billion?

According to documents disclosed on the official website of the American Securities Exchange (SEC), the Marvin family trust intends to reduce 1000W shares in total on November 21. U.S. stocks fell 9.1% on Nov. 16, evaporating above $200 billion on the day.

Undoubtedly, Musk sold at least 2 million Tesla shares in the three days from December 12 to December 14, and Tesla's share price fell on three consecutive trading days, while several institutions including Goldman Sachs and the Royal Bank of Canada lowered their target prices on Tesla.

Why do corporate executives' trading moves cause sharp fluctuations in stock prices? Constantly watched by the market again?

All because they are insiders. There is more inside information about the company's development. Insiders often have a deeper understanding of the company's performance than external analysts and investors, and have a unique advantage when it comes to trading company shares.

Therefore, in order to ensure the fairness of trading on the public market, regulations must be strictly regulated for such share transactions. According to SEC regulations, listed company insiders include directors and shareholders and restricted stock holders who hold more than 10% of the shares. Insiders of US listed companies do not have much time to trade, and the window period is usually two to three days after the end of the quarter, one month before the end of the company's quarter. You cannot trade for a period of time before each quarterly and annual report, as well as before the company has a major event. The lawful conduct of insider trading requires prior disclosure to the SEC and public acts under the supervision of the SEC.

As a U.S. stock investor, you've probably heard of “insider trading data.”

Insider means any shareholder who owns 10% or more of the company's issued shares, including directors and senior staff members of the company.

INSIDER TRADING DATA, WHICH IS HOW THEY BUY OR SELL SHARES OF THEIR COMPANY.

“Insiders may sell their shares for a variety of reasons, but there is only one reason they buy stocks, and that is they believe the share price will go up,” Peter Linquist once said. For the average investor, insider trading data is very worthy of attention.

We often think that business insiders have more inside information and are more forward-looking in their development insights than ordinary investors, so insiders' trading moves can in some sense be translated into forward-looking signals about the company's development prospects.

In fact, by tracking the changes in insider buying behavior since 2003, it can be seen that the significant peak periods of concentrated buying in November 2008, August 2011, and March 2020 were almost the moment when stocks were low, after which the S&P 500 opened a period of bull market activity. Market speculation, insider buying transactions, usually derived from a good knowledge of the company, determines that the company's stock price is undervalued.

Therefore, insider trading data can serve as an opt-in signal. That is, to have timely access to insider trading behavior data, making it easier to keep up with the rhythm of the “bookmaker” and choose a more suitable trading time.

AS REQUIRED BY THE SECURITIES EXCHANGE COMMISSION (SEC), INTERNAL STAFF ARE REQUIRED TO REPORT AND PUBLICLY DISCLOSE OBLIGATIONS WHEN BUYING OR SELLING COMPANY SHARES. THIS INFORMATION IS PUBLISHED ON THE SEC'S WEBSITE. Futubull collects and visualizes relevant data on time, so you can easily access insider trading data.

How to find US Insider Trading Data on Futubull?

Stocks > Companies > Shareholders > Insiders

After entering into the Futubull insider trading, investors do not need to download the SEC certificate data again, they can easily track the cleaned, current and real insider trading data in the aggregate.

This shows the number of insiders who have increased/decreased for almost six months

(Every day approximating six months of data is calculated)

Click to enter the details page, and the data is divided into two parts: Overview and Insider Trading:

In addition to growth and loss information, the overview shows all the latest numbers of insiders and their list, which also shows their positions, number of holdings and shareholding ratios.

INSIDER TRADING SHOWS ALMOST THREE YEARS OF INSIDER'S TRANSACTION DETAILS, CLICK ON A SINGLE CARD TO VIEW ITS DETAILS.

Click View History to see all historical trading data of this insider

What is the difference between Insider Data and Shareholder Data at Futubull USA?

In Futubull shares, corporate divisions, how are shareholders, institutional, insiders, ETFs, mutual funds, shareholders and insiders working differently?

First, there is a difference between shareholders and insiders. Shareholders include insiders, insiders are a subset of shareholders, usually consisting of senior directors and shareholders and limited share holders holding more than 10% of shares. Insiders influence corporate governance more directly and therefore are more accurate as a signal to determine the company's development.

INSIDER DATA BETTER REFLECT MARKER TRADING BEHAVIOR DATA, WHILE SHAREHOLDER DATA BETTER CORRESPOND TO SHAREHOLDER MOVEMENT DATA AT THE CORPORATE LEVEL. In insider trading data, you can see more specific types of securities. Google executive john, for example, traded Google Class C Capital Stock in November 2023 and Google Class A Ordinary Stock in September 2022, respectively.

What signals can US equity insider data give us?

As we said in the beginning, insiders are usually more knowledgeable about the company than external investors, and they are more aware of the company's internal information and future plans, so if they buy or sell a company's stock, this could be a signal of a change in the company's future prospects.

For example, if an executive buys a large number of company shares in a company's upcoming financial report, it means that he is very confident about the company's future performance.

In investment decisions, insider trading data can be used as an indicator by which we judge the fundamentals of a company. At the same time, we also need to consider the combined impact of various factors, conduct comprehensive analysis and evaluation in order to make better trading decisions.

Notes for Insider Traders in US Stocks:

INSIDER TRADING DATA IS USED AS AN INDICATOR THAT WE DETERMINE THE FUNDAMENTALS OF THE COMPANY AND CANNOT BE ANALYZED AS THE ONLY “WHEN YOU CHOOSE” INDICATOR.

Insider net buying data is more objective in judging the company's business performance.

Insider selling data is more noisy and it is easy to mask the behavior of insiders when choosing. Most executive pay for U.S. equity firms includes stocks, so selling occurs in a way that results in data statistics being more inclined to sell shares. The reasons for selling stocks are varied, which may be related to personal asset planning and financial needs.

Compared to the buy and sell direction, it is more advisable to look at the type of transaction, the type of securities, and to see the change in the number of holdings after the individual trades, which helps to make judgments, eliminate noise, and get closer to the real intentions of insider trading.

Since the shares are not required by the US Securities and Exchange Commission to submit Forms 3, 4, 5, and are rather the source of Form144 transaction data for future planned sales, it does not represent actual transaction data, such as the planned sale data for November 21, 2023, by Mawun, which does not represent actual sale data that has occurred.