Form 4 filings are one of the most underused data sources in retail investing. Here’s a practical guide to reading them.

What a Form 4 is: Any director, officer, or 10%+ shareholder of a public company must disclose equity transactions to the SEC within two business days. These filings are public, free, and updated continuously. Why insider buying matters more than selling: Insiders sell for many reasons — diversification, tax obligations, pre-scheduled plans. But they buy for one reason: they believe the stock is going higher. Open-market purchases are discretionary, personal capital at risk. That signal is hard to fake. How to read a Form 4 correctly: – The transaction code tells you everything. Code “P” means an open-market purchase — the most meaningful signal. Code “A” means a grant or award (not discretionary). Code “S” means a sale. Code “M” means an option exercise. – Look at the pattern, not just the event. One executive buying once is interesting. Three executives buying in the same two-week window is a pattern. Patterns are actionable. – Check whether a 10b5-1 plan is noted. If a sell is pursuant to a pre-established plan, it was set up months ago and tells you nothing about current sentiment. What the data looks like this week: The most notable Form 4 activity tends to cluster after earnings-driven selloffs — insiders stepping in when the market has overreacted. That pattern, historically, has been one of the cleaner signals in public market data. submitted by /u/arrremayu [link] [comments]Technical Information Security Content & DiscussionRead More