Explainer

How to read Form 4 insider trades without overreacting

Published: 2026-08-18 • Author: IO Innovation

Form 4 provides more frequent signal than 13F, but not every insider transaction is discretionary buying or selling.

Codes that matter

• P: open-market purchase (usually stronger positive signal).
• S: open-market sale (can be neutral if planned).
• A and M: grants or option exercises, often compensation related.

Best practice

• Look for repeated behavior across multiple insiders.
• Compare trade size with total holdings.
• Pair insider activity with valuation and business quality work.