Insiders at Mongolian Mining Corporation (HKG:975) made a tidy sum after selling stock currently priced at HK$2.08 at a price of US$3.96

Despite the fact that Mongolian Mining Corporation (HKG:975) stock rose 10% last week, insiders who sold US$791k worth of stock in the previous 12 months are likely to be better off. Selling at an average price of US$3.96, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out the opportunities and risks within the HK Metals and Mining industry.

Mongolian Mining Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Independent Non-Executive Director, Tze Ching Chan, sold HK$791k worth of shares at a price of HK$3.96 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (HK$2.08). So it may not shed much light on insider confidence at current levels. The only individual insider seller over the last year was Tze Ching Chan.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Insider Ownership Of Mongolian Mining

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 7.0% of Mongolian Mining shares, worth about HK$151m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Mongolian Mining Insider Transactions Indicate?

The fact that there have been no Mongolian Mining insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Mongolian Mining, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Mongolian Mining. Case in point: We've spotted 2 warning signs for Mongolian Mining you should be aware of, and 1 of them makes us a bit uncomfortable.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.