Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

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 Y. T. Realty Group Limited (HKG:75), you may well want to know whether insiders have been buying or selling.

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 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 Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

View our latest analysis for Y. T. Realty Group

The Last 12 Months Of Insider Transactions At Y. T. Realty Group

Chairman & MD Chung Kiu Cheung made the biggest insider purchase in the last 12 months. That single transaction was for HK$11m worth of shares at a price of HK$2.41 each. That means that even when the share price was higher than HK$2.30 (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. To us, it's very important to consider the price insiders pay for shares is very important. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Chung Kiu Cheung was the only individual insider to buy over the year.

Chung Kiu Cheung bought 16.4m shares over the last 12 months at an average price of HK$2.45. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Y. T. Realty Group is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

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. We usually like to see fairly high levels of insider ownership. Y. T. Realty Group insiders own about HK$99m worth of shares. That equates to 5.4% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.