- Oops!Something went wrong.Please try again later.
A Form 4 filing filed with the SEC on Monday, September 14 showed that General Manager Mfg . Ops Mcnamara Michael sold 2,200 shares of Vicor Inc (NASDAQ:VICR) at an average price of $85.13. The transaction moved the executive's stake in Vicor to 483 shares. Vicor was trading 1.5% lowher from the previous closing price.
Why Insider Transactions Are Important?
While transactions from an insider shouldn't be used as the sole item to make an investment or trading decision, an insider buying or selling stock in their company can be a good added factor that leads to more conviction in a decision.
Insiders buying stock after a notable sell off can indicate an insider's long-term belief in the success of the company; insiders buying stock at new highs can be an indication the exec doesn't feel the stock is overvalued. Conversely, insiders who are selling stock at new lows can potentially indicate some kind of capitulation moment. Insiders selling at new highs can indicate that exec wants to "take some profit" and "lock in a gain."
Transaction Codes To Focus On
Investors prefer focusing on transactions which take place in the open market, indicated in the Form 4 with codes P for purchase and S for sale. An open-market transaction means the insider went into the market of their own volition and made an active decision about the potential path for a company and its stock moving forward.
Transaction codes besides P or S aren't relatively important as they are seldom tied to a decision by the executive. For example, transaction code A is indicative of an insider being forced to sell shares to attain compensation. Moreover, transaction code C indicates the conversion of an option.
See more from Benzinga
© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.