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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 Wonderful Sky Financial Group Holdings Limited (HKG:1260).
Do Insider Transactions Matter?
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, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
View our latest analysis for Wonderful Sky Financial Group Holdings
The Last 12 Months Of Insider Transactions At Wonderful Sky Financial Group Holdings
Founder Tianni Liu made the biggest insider purchase in the last 12 months. That single transaction was for HK$33m worth of shares at a price of HK$1.40 each. That means that an insider was happy to buy shares at above the current price. Their view may have changed since then, but at least it shows they felt optimistic at the time. That purchase may suggest an expectation of positive returns over the long term. The only individual insider to buy over the last year was Tianni Liu.
Tianni Liu bought 39.59m shares over the last 12 months at an average price of HK$1.38. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Does Wonderful Sky Financial Group Holdings Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It’s great to see that Wonderful Sky Financial Group Holdings insiders own 68% of the company, worth about HK$807m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.