Market Overview

Insider Buys Nuveen Floating Rate Shares

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A Form 4 filing filed with the SEC on Monday, September 28 showed that Saba Capital Management, L.P. bought 60,105 shares of Nuveen Floating Rate Inc (NYSE:JFR) at $8.30 on Thursday, Sep 24, and bought 138,774 shares at $8.27 on Friday, Sep 25.The transaction moved the executive's stake in Nuveen Floating Rate Inc Inc. to 6,112,549 shares. Nuveen Floating Rate was trading 0.6% higher from the previous closing price.

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

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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