Anyone interested in Ellington Financial Inc. (NYSE:EFC) should probably be aware that the Co-Chief Investment Officer, Michael Vranos, recently divested US$181k worth of shares in the company, at an average price of US$12.58 each. On the bright side, that sale was only 0.7% of their holding, so we doubt it's very meaningful, on its own.

Ellington Financial Insider Transactions Over The Last Year

Notably, that recent sale by Co-Chief Investment Officer Michael Vranos was not the only time they sold Ellington Financial shares this year. Earlier in the year, they fetched US$12.15 per share in a -US$201k sale. So it's clear an insider wanted to take some cash off the table, even below the current price of US$12.81. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 0.8% of Michael Vranos's holding.

Michael Vranos ditched 50.86k shares over the year. The average price per share was US$12.35. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership Of Ellington Financial

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 2.6% of Ellington Financial shares, worth about US$29m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Ellington Financial Insider Transactions Indicate?

An insider sold Ellington Financial shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since Ellington Financial is profitable and growing, we're not too worried by this. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Ellington Financial has 4 warning signs (and 2 which are a bit concerning) we think you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.