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It is not uncommon to see companies perform well in the years after insiders buy shares. 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 Dongxiang (Group) Co., Ltd. (HKG:3818).
What Is Insider Selling?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
See our latest analysis for China Dongxiang (Group)
The Last 12 Months Of Insider Transactions At China Dongxiang (Group)
Over the last year, we can see that the biggest insider purchase was by Co-president & Executive Director Chen Chen for HK$35m worth of shares, at about HK$1.15 per share. That means that even when the share price was higher than HK$0.99 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months insiders paid HK$63m for 52.8m shares purchased. China Dongxiang (Group) may have bought shares in the last year, but they didn't sell any. 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!
China Dongxiang (Group) is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at China Dongxiang (Group) Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at China Dongxiang (Group). We can see that Chen Chen paid CN¥37m for shares in the company. No-one sold. This could be interpreted as suggesting a positive outlook.