Market Overview

Insider Buys LiveXLive Media Shares

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Chairman Ellin Robert S filed a Form 4 with the SEC on Wednesday, September 2. The insider bought 400 shares of LiveXLive Media Inc (NASDAQ:LIVX) at $2.74 on Monday, Aug 31, and bought 2,000 shares at $2.72 on Tuesday, Sep 01. After the transactions, the executive's stake in LiveXLive Media Inc. movedto 1,438,746 shares. LiveXLive Media was trading 6% lower from the previous closing price.

The Importance of Insider Transactions

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. Conversely, insiders who are selling stock at new lows can potentially indicate some kind of capitulation moment. Insiders selling at new highs can indicate that exec wants to "take some profit" and "lock in a gain."

Transaction Codes To Focus On

Investors prefer focusing on transactions which take place in the open market, indicated in the Form 4 with 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 other than P or S are often viewed with less conviction as they are often not tied to a decision by the exec. As an example, transaction code C indicates the conversion of an option. Transaction code A indicates the insider may have been forced to sell shares in order to receive compensation the exec was promised upon being hired by a company.

 

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