We wouldn't blame Bright Smart Securities & Commodities Group Limited (HKG:1428) shareholders if they were a little worried about the fact that Mow Lum Yip, the Executive Chairman recently netted about HK$12m selling shares at an average price of HK$1.50. However, that sale only accounted for 0.8% of their holding, so arguably it doesn't say much about their conviction.

View our latest analysis for Bright Smart Securities & Commodities Group

The Last 12 Months Of Insider Transactions At Bright Smart Securities & Commodities Group

Notably, that recent sale by Executive Chairman Mow Lum Yip was not the only time they sold Bright Smart Securities & Commodities Group shares this year. Earlier in the year, they fetched HK$1.71 per share in a -HK$28m sale. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$1.42. So it may not shed much light on insider confidence at current levels.

Happily, we note that in the last year insiders paid HK$6.5m for 5.59m shares. But insiders sold 115.16m shares worth HK$186m. Mow Lum Yip divested 115.16m shares over the last 12 months at an average price of HK$1.61. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Insider Ownership Of Bright Smart Securities & Commodities Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Bright Smart Securities & Commodities Group insiders own about HK$1.4b worth of shares (which is 58% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Bright Smart Securities & Commodities Group Tell Us?

An insider sold Bright Smart Securities & Commodities Group shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since Bright Smart Securities & Commodities Group is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 3 warning signs for Bright Smart Securities & Commodities Group you should be aware of.

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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.