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We often see insiders buying up shares in companies that perform well over the long term. 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 China Tian Lun Gas Holdings Limited (HKG:1600), 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 on the market. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
View our latest analysis for China Tian Lun Gas Holdings
China Tian Lun Gas Holdings Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Yuen Kim Koo for HK$8.5m worth of shares, at about HK$8.64 per share. So it’s clear an insider wanted to buy, even at a higher price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. We generally consider it a positive if insiders have been buying on market, even above the current price. The only individual insider to buy over the last year was Yuen Kim Koo.
You can see a visual depiction of insider transactions 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).
Insider Ownership of China Tian Lun Gas Holdings
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. China Tian Lun Gas Holdings insiders own about HK$871m worth of shares (which is 14% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The China Tian Lun Gas Holdings Insider Transactions Indicate?
It doesn’t really mean much that no insider has traded China Tian Lun Gas Holdings shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. It would be great to see more insider buying, but overall it seems like China Tian Lun Gas Holdings insiders are reasonably well aligned (owning significant chunk of the company’s shares) and optimistic for the future. Of course, the future is what matters most. So if you are interested in China Tian Lun Gas Holdings, you should check out this free report on analyst forecasts for the company.