Market Overview

Insider Buys Nuveen Short Duration Shares

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Saba Capital Management, L.P. filed a Form 4 with the SEC on Monday, September 28. The insider bought 22,480 shares of Nuveen Short Duration Inc (NYSE:JSD)at $12.33 on Thursday, Sep 24, and bought 2,100 shares at $12.32 on Friday, Sep 25. . After the transactions, the executive's stake in Nuveen Short Duration Inc. movedto 1,112,783 shares. Nuveen Short Duration was trading 0.2% higher from the previous closing price.

The Importance of Insider Transactions

While transactions from an insider shouldn't be used as the sole item to make an investment or trading decision, an insider buying or selling stock in their company can be a good added factor that leads to more conviction in a 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."

Important Transaction Codes

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 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.

 

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