Have Insiders Been Buying Finsoft Financial Investment Holdings Limited (HKG:8018) Shares This Year?

We often see insiders buying up shares in companies that perform well over the long term. 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 Finsoft Financial Investment Holdings Limited (HKG:8018), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

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, 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 logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

View our latest analysis for Finsoft Financial Investment Holdings

Finsoft Financial Investment Holdings Insider Transactions Over The Last Year

The Executive Chairman Yat Yu Tin made the biggest insider purchase in the last 12 months. That single transaction was for HK$2.9m worth of shares at a price of HK$0.058 each. That means that an insider was happy to buy shares at above the current price of HK$0.04. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Over the last year, we can see that insiders have bought 135.91m shares worth HK$7.3m. But they sold 98.07m shares for HK$5.6m. In total, Finsoft Financial Investment Holdings insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Finsoft Financial Investment Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership

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. Insiders own 39% of Finsoft Financial Investment Holdings shares, worth about HK$19m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Finsoft Financial Investment Holdings Insiders?

It doesn't really mean much that no insider has traded Finsoft Financial Investment Holdings shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Finsoft Financial Investment Holdings and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Finsoft Financial Investment Holdings. Case in point: We've spotted 3 warning signs for Finsoft Financial Investment Holdings you should be aware of, and 2 of these can't be ignored.

But note: Finsoft Financial Investment 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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