Insider Buys Tortoise Essential Assets' Shares

Shares of Tortoise Essential Assets Inc TEAF rose by 0.27% from the previous closing price. Berney Rand C filed a Form 4 with the SEC on Sunday, July 19. The insider bought 1,000 shares at an average price of $11.11. After the transaction, the executive's stake in Tortoise Essential Assets Inc. moved to 1,000 shares.

Why Insider Transactions Are Important?

Insider transactions shouldn't be used primarily to make an investing decision, however an insider transaction can be an important factor in the investing decision.

When an insider buys stock after an important sell off, that can indicate the insider's faith in the success of the organization. Henceforth, if the stock is bought at new highs, it might be because the insider feels that the stock is not overvalued. Insiders who sell stock at new lows could be anticipating some capitulation moment. If the insider sells at new highs, it could point to the intention to "take some profit" and "lock in a gain."

Transaction Codes To Focus On

Wall Street tends to focus on insider transactions which take place in the open market, viewed inside a Form 4 filing via codes P for purchase and S for sale. If the transaction was an open-market transaction, that means that the insider made a concious decision for the company's stock moving forward.

Transaction codes besides P or S aren't relatively important as they are seldom tied to a decision by the executive. For example, transaction code A is indicative of an insider being forced to sell shares to attain compensation. Moreover, transaction code C indicates the conversion of an option.