Insider Buys Templeton Global Income Fund's Stock

A Form 4 filing filed with the SEC on Wednesday, January 20 showed that Saba Capital Management, L.P. bought 190,976 shares of Templeton Global Income Fund GIM at $5.55 on Friday, Jan 15, and bought 178,785 shares at $5.58 on Tuesday, Jan 19.The transaction moved the executive's stake in Templeton Global Income Inc. to 21,842,217 shares. Templeton Global Income Fund was trading 0.1% lower from the previous closing price.

Why Insider Transactions Are Important?

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.

Insiders buying stock after a notable sell off can indicate an insider's long-term belief in the success of the company; insiders buying stock at new highs can be an indication the exec doesn't feel the stock is 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."

Important Transaction Codes

Wall Street tends to focus on insider transactions which take place in the open market, viewed inside a Form 4 filing via codes P for purchase and S for sale. An open-market transaction means the insider went into the market of their own volition and made an active decision about the potential path for a company and its 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.