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Standard Chartered PLC (LON:STAN) Insiders Increased Their Holdings

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·4 min read
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Standard Chartered PLC (LON:STAN), you may well want to know whether insiders have been buying or selling.

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 in the company. 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 it is perfectly logical to keep tabs on what insiders are doing. 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 Standard Chartered

The Last 12 Months Of Insider Transactions At Standard Chartered

The Group Chief Executive & Director William Winters made the biggest insider purchase in the last 12 months. That single transaction was for UK£833k worth of shares at a price of UK£4.90 each. So it's clear an insider wanted to buy, at around the current price, which is UK£5.08. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Standard Chartered share holders is that insiders were buying at near the current price.

Happily, we note that in the last year insiders paid UK£2.2m for 446.73k shares. On the other hand they divested 95.25k shares, for UK£480k. In the last twelve months there was more buying than selling by Standard Chartered insiders. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

Standard Chartered is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Standard Chartered Insiders Bought Stock Recently

There has been significantly more insider buying, than selling, at Standard Chartered, over the last three months. In fact, five insiders bought UK£2.1m worth of shares. But we did see insider Pi Cheng Hung sell shares worth UK£480k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 0.2% of Standard Chartered shares, worth about UK£29m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Standard Chartered Insider Transactions Indicate?

It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Standard Chartered shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Standard Chartered. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Standard Chartered.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.