Decode the behavior of corporate executives using SEC Form 4 filing data.
"Insiders might sell for many reasons, but they buy for only one: they think the price will rise." — Peter Lynch
Neutral Signal
Confidence Score based on Buy/Sell Cluster
Buy/Sell Ratio
0.46x
Relative Buying Power
Volume Impact
3.5%
Of Daily Turnover
Cluster Buying
Multi-person signal
Tax Selling
Often non-predictive
In the US market, company "insiders" (officers, directors, or owners of more than 10% of a company's stock) are required by the SEC to report their trades on **Form 4**. These filings provide a window into what the people with the most information actually think about their company's future value.
When executives buy shares with their own money (Open Market Purchase), it is a powerful bullish signal. It indicates they believe the stock is undervalued or that major positive developments are ahead.
Insider selling is more ambiguous. Executives sell for many reasons: paying taxes on RSU vests, diversifying their portfolio, or major personal purchases. Selling only becomes a "Red Flag" when multiple insiders sell large amounts simultaneously (Cluster Selling).
The most reliable signals come from **Cluster Activity**. If the CEO, CFO, and three directors all buy shares within the same week, the signal is exponentially more significant than a single director buying. This indicates a consensus of confidence within the board.
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