Chairman & CEO Of CME Group Sold 37% Of Their Shares

We wouldn't blame CME Group Inc. (NASDAQ:CME) shareholders if they were a little worried about the fact that Terrence Duffy, the Chairman & CEO recently netted about US$8.4m selling shares at an average price of US$211. That sale reduced their total holding by 37% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for CME Group

The Last 12 Months Of Insider Transactions At CME Group

Notably, that recent sale by Terrence Duffy is the biggest insider sale of CME Group shares that we've seen in the last year. So what is clear is that an insider saw fit to sell at around the current price of US$208. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

Over the last year we saw more insider selling of CME Group shares, than buying. The chart below shows insider transactions (by companies and individuals) over the last year. 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 CME Group

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that CME Group insiders own 0.3% of the company, worth about US$234m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About CME Group Insiders?

The stark truth for CME Group is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But since CME Group is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we found 2 warning signs for CME Group that deserve your attention before buying any shares.

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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 of direct interests only, but not derivative transactions or indirect interests.

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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.