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U.S. Insider Trading Activity on 4/8/2020
 

An insider trade occurs when an individual that has non-public information about a company buys or sells shares of that company's stock. Examples of people who would be considered insiders include a company's executive officers, its board of directors, and its major shareholders. Tracking a company's insider trades is a metric that can be used to identify the direction that the company's executives believe that the company is headed. For example, if many insiders purchase more shares of a company, they may think that the company will have strong future earnings and that the share price will increase in the near future. What you need to know about insider trading.

 
CompanyInsider NameBuy/SellShares Bought/SoldTotal TransactionShares Held After TransactionTransaction DateActions
ADPT
Adaptive Biotechnologies Corporation
Chad M Cohen (CFO)Sell15,000$367,050.00 16,0004/8/2020  
AIRI
Air Industries Group Inc
Michael N Taglich (Director)Buy45,000$46,800.004/7/2020  
Analog Devices, Inc. logo
ADI
Analog Devices, Inc.
Gregory N Henderson (SVP)Sell1,703$170,300.00 5,8264/7/2020  
B. Riley Financial Inc logo
RILY
B. Riley Financial Inc
B. Riley Financial, Inc. (Major Shareholder)Buy12,275$39,648.254/8/2020  
B. Riley Financial Inc logo
RILY
B. Riley Financial Inc
B. Riley Financial, Inc. (Major Shareholder)Buy100,000$270,000.004/6/2020  
Black Knight Inc logo
BKI
Black Knight Inc
William P Foley II (Chairman)Sell100,000$6,156,000.00 4,395,7344/6/2020  
bluebird bio Inc logo
BLUE
bluebird bio Inc
Joanne Smith-Farrell (Insider)Sell583$25,494.59 21,3934/6/2020  
Capital Senior Living Co. logo
CSU
Capital Senior Living Co.
Brandon Ribar (COO)Buy82,355$45,295.25 152,3554/6/2020  
Centene Corp logo
CNC
Centene Corp
Tommy G. Thompson (Director)Sell1,500$87,000.004/6/2020  
Ciena Co. logo
CIEN
Ciena Co.
Gary B. Smith (CEO)Sell4,250$187,212.504/6/2020  
Coupa Software Inc logo
COUP
Coupa Software Inc
Anthony D Tiscornia (CAO)Sell988$128,687.00 2004/6/2020  
CRWD
Crowdstrike Holdings Inc
Colin Black (COO)Sell14,150$849,000.00 14,1504/6/2020  
CRWD
Crowdstrike Holdings Inc
Pincus Private Equity Warburg (Director)Sell9,690,000$557,271,900.00 9,690,0004/6/2020  
DexCom, Inc. logo
DXCM
DexCom, Inc.
Kevin R. Sayer (CEO)Sell6,000$1,576,860.004/7/2020  
Edwards Lifesciences Corp logo
EW
Edwards Lifesciences Corp
Michael A Mussallem (CEO)Sell22,850$4,623,469.00 69,9764/7/2020  
Energy Recovery, Inc. logo
ERII
Energy Recovery, Inc.
Arve Hanstveit (Director)Sell23,000$163,070.00 1,072,7333/24/2020  
Energy Recovery, Inc. logo
ERII
Energy Recovery, Inc.
Arve Hanstveit (Director)Sell23,067$164,006.37 1,072,7333/20/2020  
Etsy Inc logo
ETSY
Etsy Inc
Goyal Kruti Patel (Insider)Sell3,399$169,950.00 23,3254/7/2020  
FSLY
Fastly Inc
Artur Bergman (Insider)Sell15,000$300,900.00 494,3424/6/2020  
Five9 Inc logo
FIVN
Five9 Inc
Rowan M Trollope (CEO)Sell12,600$969,948.00 338,0604/7/2020  
Five9 Inc logo
FIVN
Five9 Inc
Daniel P Burkland (President)Sell15,000$1,145,400.00 122,5744/6/2020  
Green Dot Co. logo
GDOT
Green Dot Co.
Robert Strub (COO)Sell4,603$115,075.00 101,5334/7/2020  
SHRG
GreenBox POS
Document Security Systems Inc (Major Shareholder)Buy489,344$39,147.524/6/2020  
GrubHub Inc logo
GRUB
GrubHub Inc
Adam Dewitt (CFO)Sell1,200$43,260.00 55,8194/6/2020  
Haemonetics Co. logo
HAE
Haemonetics Co.
Dan Goldstein (VP)Sell399$38,750.884/8/2020  
Haemonetics Co. logo
HAE
Haemonetics Co.
Dan Goldstein (VP)Sell2,607$264,923.344/6/2020  
Hershey Co logo
HSY
Hershey Co
Pamela M Arway (Director)Sell347$49,402.39 15,9454/7/2020  
Horizon Therapeutics PLC logo
HZNP
Horizon Therapeutics PLC
Brian K Beeler (EVP)Sell2,370$77,025.00 110,3834/6/2020  
Hormel Foods Corp logo
HRL
Hormel Foods Corp
Jana L Haynes (VP)Sell18,550$895,779.50 18,2594/6/2020  
ICF International Inc logo
ICFI
ICF International Inc
John Wasson (CEO)Sell4,746$320,165.16 83,5544/6/2020  
Illumina, Inc. logo
ILMN
Illumina, Inc.
Jay T Flatley (Director)Sell2,000$569,260.00 255,9704/7/2020  
Illumina, Inc. logo
ILMN
Illumina, Inc.
Jay T Flatley (Director)Sell3,000$897,000.00 255,9702/18/2020  
Incyte Co. logo
INCY
Incyte Co.
Maria E. Pasquale (EVP)Sell1,842$156,570.00 23,8314/6/2020  
Iradimed Corp logo
IRMD
Iradimed Corp
Brent Johnson (VP)Sell4,000$80,040.00 6,9404/8/2020  
Iradimed Corp logo
IRMD
Iradimed Corp
Brent Johnson (VP)Sell4,000$80,360.00 6,9404/6/2020  
Maxim Integrated Products Inc. logo
MXIM
Maxim Integrated Products Inc.
Tunc Doluca (CEO)Sell6,000$308,100.004/6/2020  
Merrimack Pharmaceuticals Inc logo
MACK
Merrimack Pharmaceuticals Inc
Eric Andersen (Insider)Buy16,793$58,103.784/6/2020  
Monolithic Power Systems, Inc. logo
MPWR
Monolithic Power Systems, Inc.
Michael Hsing (CEO)Sell17,742$3,016,140.00 1,171,1024/6/2020  
Morningstar, Inc. logo
MORN
Morningstar, Inc.
Joseph D Mansueto (Chairman)Sell15,574$1,776,993.40 20,557,7944/6/2020  
Msci Inc logo
MSCI
Msci Inc
Cd Baer Pettit (COO)Sell1,903$545,076.29 290,8454/6/2020  
Natera Inc logo
NTRA
Natera Inc
Michael Burkes Brophy (CFO)Sell2,251$65,301.51 24,7324/6/2020  
Newmont Goldcorp Corp logo
NEM
Newmont Goldcorp Corp
Dean Gehring (EVP)Sell4,000$193,720.00 24,2934/6/2020  
Newmont Goldcorp Corp logo
NEM
Newmont Goldcorp Corp
John Kitlen (CAO)Sell1,500$72,645.00 41,7344/6/2020  
NREF
NexPoint Real Estate Finance
James D Dondero (President)Buy44,179$437,372.104/7/2020  
NGM
NGM Biopharmaceuticals
Group L P Column (Major Shareholder)Buy138,315$1,962,689.854/7/2020  
NVIDIA Co. logo
NVDA
NVIDIA Co.
Mark A. Stevens (Director)Sell60,000$15,697,800.004/6/2020  
NVIDIA Co. logo
NVDA
NVIDIA Co.
Mark A. Stevens (Director)Sell10,000$2,660,200.004/8/2020  
Opko Health Inc. logo
OPK
Opko Health Inc.
Phillip Md Et Al Frost (CEO)Buy400,000$512,000.00 3,068,9514/7/2020  
Peoples Utah Bancorp logo
PUB
Peoples Utah Bancorp
Jr. Fred W Fairclough (Director)Sell3,750$67,875.004/8/2020  
Primoris Services Corp logo
PRIM
Primoris Services Corp
Thomas Edward Mccormick (CEO)Sell2,150$24,703.50 68,1283/17/2020  
Proofpoint Inc logo
PFPT
Proofpoint Inc
Gary Steele (CEO)Sell20,000$2,177,600.00 105,9544/7/2020  
Quanterix Corp logo
QTRX
Quanterix Corp
Martin D. Madaus (Director)Sell4,400$89,540.004/6/2020  
Regeneron Pharmaceuticals Inc logo
REGN
Regeneron Pharmaceuticals Inc
Robert E Landry (CFO)Sell696$346,273.92 27,3734/7/2020  
Semtech Co. logo
SMTC
Semtech Co.
Mark C Costello (VP)Sell1,336$56,085.28 12,1124/8/2020  
Splunk Inc logo
SPLK
Splunk Inc
Timothy Tully (SVP)Sell5,402$585,414.74 146,0394/6/2020  
Sportsman's Warehouse Holdings Inc logo
SPWH
Sportsman's Warehouse Holdings Inc
Kent Vernon Graham (Director)Sell10,000$58,500.00 63,0054/6/2020  
EDI
Stone Harbor Emerging Mkt Total Incom FD
Adam J Shapiro (Insider)Buy5,000$33,000.004/7/2020  
Tandem Diabetes Care Inc logo
TNDM
Tandem Diabetes Care Inc
David B Berger (EVP)Sell2,000$135,180.00 5,3114/6/2020  
Tiptree Inc logo
TIPT
Tiptree Inc
Michael Gene Barnes (Major Shareholder)Buy4,954$26,107.584/7/2020  
Trade Desk Inc logo
TTD
Trade Desk Inc
Vivian Yang (Insider)Sell3,405$698,025.00 29,9984/7/2020  
Tricida Inc logo
TCDA
Tricida Inc
Gerrit Klaerner (CEO)Sell4,000$96,880.00 559,3214/6/2020  
TPTX
Turning Point Therapeutics
Jingrong Jean Cui (Director)Sell18,500$804,935.00 1,001,2984/6/2020  
TPTX
Turning Point Therapeutics
Jingrong Jean Cui (Director)Sell18,500$855,625.00 1,001,2984/8/2020  
Tyme Technologies Inc logo
TYME
Tyme Technologies Inc
Michael Demurjian (Major Shareholder)Sell20,000$21,000.00 23,938,5464/6/2020  
Verint Systems Inc. logo
VRNT
Verint Systems Inc.
Douglas Robinson (CFO)Sell1,841$73,198.16 177,9284/7/2020  
Verint Systems Inc. logo
VRNT
Verint Systems Inc.
Dan Bodner (CEO)Sell7,849$312,076.24 721,2964/7/2020  
Verint Systems Inc. logo
VRNT
Verint Systems Inc.
Elan Moriah (Insider)Sell2,599$103,336.24 89,0814/7/2020  
Vertex Pharmaceuticals Incorporated logo
VRTX
Vertex Pharmaceuticals Incorporated
Paul M Silva (SVP)Sell4,891$1,249,992.87 19,8234/6/2020  
Xencor Inc logo
XNCR
Xencor Inc
John S Stafford III (Major Shareholder)Sell644,771$17,686,068.534/6/2020  
Yext Inc logo
YEXT
Yext Inc
Brian Distelburger (President)Sell10,000$103,100.00 3,661,6324/7/2020  
Yext Inc logo
YEXT
Yext Inc
Tom Christopher Dixon (CTO)Sell2,500$25,925.00 203,9084/7/2020  
Insider Trading - What You Need to Know

We all like having inside information. But much of the time, what’s passed off as inside information, is just idle gossip. In other cases, we know that having inside information is really a way for an organization to profit from delivering what is viewed as premium content. Still, the basic idea behind inside information is that you are getting information that the general public does not have.

When it comes to investing, this practice of acting on inside information is known as insider trading. In recent years, insider trading may bring to mind a celebrity such as Martha Stewart. Going back to the 1980s, one of the most popular movies of the decade, Wall Street, is at its core a movie that highlights the dangers of insider trading.

The idea of price fixing, athletic competitions being fixed, even athletes using performance-enhancing drugs spark strong emotions and opinions in our society. That’s why it may surprise you to know that insider trading – in some cases, is perfectly legal.

This article will provide a definition of insider trading, who constitutes an insider, why inside trading is harmful, and when – and under what conditions - insider trading can be legal.

What is insider trading?

Insider trading is the action of buying or selling (“trading”) a security based on material information that is not available to the public. Although generally assumed to be illegal, there are times when insider trading can be legal. In these cases, the trades have to be properly disclosed to the SEC (more on that below).

For insider trading to be illegal, essentially three conditions have to be met:

  1. Information has to be passed along by an insider.
  2. That information has to be acted upon (traded) by the individual(s) receiving the inside information.
  3. The trading activity has to occur before the inside information becomes available to the general public.

Who is an insider?

If your friend’s girlfriend’s uncle passes along a “hot tip” that they received, your first question – that is if you thought the tip was credible at all – might be who’s your source? That is a critical distinction for insider trading. To constitute insider trading, the private or confidential information being passed along must be issued by an insider.

An insider is defined as someone who meets one of two conditions:

  1. They are an individual who has access to valuable non-pubic information about a corporation. Although this includes a company’s directors and high-level executives, it has been expanded in recent years to include virtually any employee of a company. In this case, the individual is presumed to have a fiduciary interest in the company and therefore should put the company’s interests ahead of their own.
  2. They have an ownership stake in the company’s stock that equals over 10% of that company’s equity.

However, in the case of insider trading, the definition of “insider” expands to include any individual who buys or sells shares of a security based on inside information material to that security’s price that is not public knowledge. In recent history, one of the more recognizable cases of insider trading involved Martha Stewart, who was convicted of insider trading for selling shares based on a tip that she received from a broker at Merrill Lynch (someone who met condition #1 above). And in 2018, a professional football player Mychal Kendricks was indicted for insider trading after acting upon information he received from an acquaintance who was a broker with Goldman Sachs. 

This brings up a critical point to understand insider trading. The SEC makes no distinction between the "tipper" and the "tipee". In the two instances above, neither Stewart nor Kendricks worked for the company or an investment firm. In the case of Stewart, she was an existing shareholder. In the case of Kendricks, he entered and exited trades based on the information he received. However, in both cases, they were indicted for insider trading because they acted on the information they received before the information was available to the public.

So getting back to our example, if your friend’s girlfriends uncle was the Vice President of the company that the “hot tip” is based on, you should tread very carefully before deciding to take action. However, simply being informed of the tip does not constitute an illegal activity.

Can someone be guilty of insider trading for idle conversation?

For an individual to be guilty of insider trading do they have to have intent? A Supreme Court ruling, Dirks v. SEC cites “the mere disclosure of material, nonpublic information, by itself, does not necessarily constitute a breach of an insider’s fiduciary duties.” Another case, SEC v Switzer, upheld this ruling. In that case, a former college football coach, Barry Switzer, overheard the former CEO of Texas International discussing nonpublic, material information with his wife while at a high school track meets and act upon that information. The case went to trial and the Supreme Court ruled that the CEO did not breach his fiduciary duties.

However, this is still considered a high standard to be met. For example, in the Switzer case, the CEO was talking to his wife in what he believed to be a private conversation. However, if he had been talking directly to Switzer, even if he had no reason to believe his information would be acted upon, he could have been guilty of insider trading. 

Why is insider trading harmful?

For companies, insider trading is a violation of an insider’s fiduciary duty. In their fiduciary role, they are supposed to put their client’s (in this case, their company’s) interests ahead of their own. By trading on inside information, particularly when it involves selling shares that can affect a company’s stock price; they are putting their own interests, or the interests of other, select individuals, ahead of the company.

A second reason is one that affects both retail and individual investors and that is the notion that insider trading violates the principle of transparency. In a properly functioning market, all investors have access to the same information and can make their investment decisions accordingly. The very nature of insider trading violates transparency because the intention is to give a select few investors a material advantage over the vast majority of investors. If allowed to proceed unpunished, individual investors would quickly lose confidence in the market and could easily choose not to participate in the market.

Insider trading versus inside information

The word “Insider” has become a, perhaps overused, marketing term that many companies, particularly content providers, use as a way to increase their subscriber base for paid content. The idea is that by becoming an “insider”, subscribers have access to information that non-subscribers do not. This, however, is not illegal because all consumers have the same access to the information; it’s just a question of whether or not they are willing to pay for it.

In the specific context of insider trading, the key distinction between insider trading and insider information is the idea of taking action on the information. For example, if an executive of a company knows that their company is going to buy another company and they pass that information along to family and friends that is not, by itself, insider trading. However, it becomes insider trading as soon as anyone acts upon that information to buy or sell the company’s stock in advance of that announcement becoming public information. Using the same logic, if someone who became privy to that information initiates their trade after the information goes public, they are not guilty of insider trading. So the key difference between insider trading and inside information is the word “trading”.

When is insider trading legal?

There are times when insider trading is legal. Insiders (as defined above) can, and frequently do, trade stock in their own company. These trades, however, are highly restricted and must meet certain conditions. The insiders conducting the trade must report the trade to the SEC within two business days of when the trade occurred. So if an insider sells 5,000 shares on a Monday, assuming there is no Holiday in between, they would have to report this sale by Wednesday. If the trade is done on a Friday, they would have to report it by the following Tuesday. The SEC has a specific form, called Form 4, that will detail the trade and make it public record. The insider must also file a Form 14a, that lists all of the company’s directors and officers along with any share interest they may have.

Obviously, knowledge of whether a company was buying or selling a large number of shares would be valuable to an individual investor. This is particularly true in the case that shares of a company are being purchased. SEC rules prevent insiders from trading company stock within any six-month period, so if an insider is buying their company’s stock an individual investor can reasonably surmise that the company’s growth prospects are good.

Information on insider trading activity is available on many financial websites; however, in some cases, the filings do not appear right away. For the most current information, investors can go to the SEC’s EDGAR (Electronic Data Gathering, Analysis, and Retrieval) database. You will first have to search the database for a company’s CIK number, and then you can find any individual filings related to that company.

How is legal and illegal insider trading different?

The key distinction between insider trading is legal and illegal is one of intent. In the case of legal insider trading, a company is tipping the public to their actions by way of an SEC filing that is available for public scrutiny. Since a company may have many insiders, sometimes numbering in the hundreds, the insider information may paint a contradictory picture. In this case, individual investors will still have to rely on fundamental analysis or technical analysis to discern price movement.

In the case of illegal insider trading, the intent is to act on inside information before the public has knowledge of it. In this way, a select few “insiders” can profit from the information.

The bottom line on insider trading

Is it illegal or just idle gossip? Is the information from a credible source with access to private company information, or is it simply speculation based on publicly available information? These are two questions that are at the heart of insider trading. The practice of allowing a select few groups of investors to profit by letting them buy or sell a stock or security based on material information that is not available to the general public is, and always be considered, illegal in the eyes of the Securities & Exchange Commission. For this reason, many companies make even the lowest level employees sign non-disclosure agreements that can lead to termination, or at least censure if they knowingly pass along material information about the company to outside sources.

Insider trading requires access to material information that is traded upon before that information is available to the public. To be guilty of insider trading, such as the case of Martha Stewart, an individual does not have to be an employee of the company or an investment firm with access to the knowledge (i.e. the tipper). Even the person who receives the tip can be indicted and convicted if they took action that allowed them to profit from the information. However, just being presented with information does not make an individual guilty of insider trading.

Although generally assumed to be illegal in all cases, insider trading has been around for decades, and in some cases is entirely legal. If properly disclosed, knowledge of insider trading activity can be a tremendous benefit to institutional and retail investors. In fact, some analysts and investment brokers use insider trading information to supplement their fundamental analysis or technical analysis of a company.

 

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