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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Hang Lung Properties Limited (HKG:101), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
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Hang Lung Properties Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Executive Director Wenbwo Chan for HK$46m worth of shares, at about HK$18.20 per share. That means that an insider was happy to buy shares at above the current price. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. We generally consider it a positive if insiders have been buying on market, even above the current price.
In the last twelve months insiders paid HK$411m for 24.28m shares purchased. In the last twelve months there was more buying than selling by Hang Lung Properties insiders. The average buy price was around HK$16.93. This is nice to see since it implies that insiders might see value around current prices (around HK$15.94). You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Hang Lung Properties Insiders Bought Stock Recently
Over the last quarter, Hang Lung Properties insiders have spent a meaningful amount on shares. We can see that Independent Non-Executive Director Wai Yuen paid HK$102m for shares in the company. No-one sold. This is a positive in our book as it implies some confidence.