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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in In Construction Holdings Limited (HKG:1500).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. 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.’
See our latest analysis for In Construction Holdings
The Last 12 Months Of Insider Transactions At In Construction Holdings
While there weren’t any large insider transactions in the last twelve months, it’s still worth looking at the trading.
In the last twelve months insiders paid HK$580k for 2.02m shares purchased. In the last twelve months there was more buying than selling by In Construction Holdings insiders. They paid about HK$0.29 on average. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price of HK$0.30. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
In Construction Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at In Construction Holdings Have Bought Stock Recently
It’s good to see that In Construction Holdings insiders have made notable investments in the company’s shares. Specifically, Chi Yau bought HK$570k worth of shares in that time, and we didn’t record any sales whatsoever. That shows some optimism about the company’s future.
Insider Ownership of In Construction Holdings
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. In Construction Holdings insiders own 74% of the company, currently worth about HK$185m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.