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Massive Insider Trading at Ares Management – Ares Management (NYSE:ARES)

Aghili Naseem Sagatigeneral counsel at Management of Ares ARESreported a major insider sell on Nov. 10, according to a new SEC filing.

What happened: A Form 4 filed Thursday by the U.S. Securities and Exchange Commission showed Sagati had sold 15,000 shares of Management of Ares. The total transaction amounted to $1,273,800.

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The importance of insider trading

Insider trading should not be used primarily to make an investment decision, however, it can be an important factor for an investor to consider.

In legal terms, an “insider” is any shareholder who owns at least 10% of a company. This can include senior executives and large hedge funds. These insiders are required to notify the public of their trades via a Form 4 filing, which must be filed within two business days of the trade.

When a company insider makes a new purchase, it indicates that they expect the stock to rise.

Insider selling, on the other hand, can be done for a variety of reasons and does not necessarily mean that the seller thinks the stock will go down.

Transaction codes to focus on

Investors prefer to focus on transactions that take place in the open market, shown in Table I of the Form 4 filing. P in box 3 indicates a purchase, while S indicates a sale. Transaction code VS indicates the conversion of an option, and the transaction code A indicates that the insider may have been forced to sell stock in order to receive compensation that was promised when hired by the company.

See Ares Management’s full list of insider trading.

This article was generated by Benzinga’s automated content engine and reviewed by an editor.