The point - Whenever an insider make a buy/sell activity or a series of buy/sell activities, we should pay attention.
We need to evaluate that action/s in perspective ie.
- How insider is this person? Key/majority/very executive shareholder?
- no. of shares bought/sold against his existing holding
- any reason given for the buy/sell - Sometime, the person may sell to pay for the bungalow he is buying etc etc.
- pattern based on past activities of this person
Let us take a look at what is reported in Straits Times today on the sale of 1.1mio made by HG Metal Chairman.
- Who is he? The Chairman of the company.
- 1.1mio shares sold --> reduced his total shareholding position from 6.06% to 5.65%.
- no reason given
- pattern of activity - I did not check.
My view - He sold when the share price broke new high yesterday. I think he could be cashing in on some of the gains.
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