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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in China SCE Group Holdings Limited (HKG:1966).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
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The Last 12 Months Of Insider Transactions At China SCE Group Holdings
In the last twelve months, the biggest single purchase by an insider was when Chairman Chiu Wong bought HK$14m worth of shares at a price of HK$2.82 per share. So it’s clear an insider wanted to buy, at around the current price. That means they have been optimistic about the company in the past, though they may have changed their mind. In any event it’s generally a positive if insiders are buying shares at around the current price.
In the last twelve months insiders paid HK$123m for 43.00m shares purchased. In total, China SCE Group Holdings insiders bought more than they sold over the last year. Their average price was about HK$2.87. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price of HK$3.18. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at China SCE Group Holdings Have Bought Stock Recently
It’s good to see that China SCE Group Holdings insiders have made notable investments in the company’s shares. Overall, 3 insiders shelled out CN¥113m for shares in the company — and none sold. This is a positive in our book as it implies some confidence.