Read This Before Selling Kin Yat Holdings Limited (HKG:638) Shares

We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Kin Yat Holdings Limited (HKG:638).

What Is Insider Buying?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. 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 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'.

Check out our latest analysis for Kin Yat Holdings

The Last 12 Months Of Insider Transactions At Kin Yat Holdings

While no particular insider transaction stood out, we can still look at the overall trading.

Chor Kit Cheng bought 190.00k shares over the last 12 months at an average price of HK$0.82. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

Kin Yat Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Kin Yat Holdings Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Kin Yat Holdings insiders own about HK$413m worth of shares (which is 69% 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.

What Might The Insider Transactions At Kin Yat Holdings Tell Us?

Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Kin Yat Holdings insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Kin Yat Holdings. Our analysis shows 4 warning signs for Kin Yat Holdings (1 shouldn't be ignored!) and we strongly recommend you look at these before investing.

But note: Kin Yat Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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