Arthur J. Gallagher General Counsel Acquires 21,800 Shares After Exercising Company Stock Options

Walter Bay, General Counsel at Arthur J. Gallagher AJG, reported a large exercise of company stock options on September 20, according to a new SEC filing.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Wednesday showed that Bay, General Counsel at Arthur J. Gallagher, a company in the Financials sector, just exercised stock options worth 21,800 shares of AJG stock with an exercise price of $56.86.

Arthur J. Gallagher shares are trading up 0.3% at $236.49 at the time of this writing on Wednesday morning. Since the current price is $236.49, this makes Bay's 21,800 shares worth $5,155,482.

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Why Insider Transactions Are Important

Insider transactions shouldn't be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.

In legal terms, an "insider" refers to any shareholder who owns at least 10% of a company. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Important Transaction Codes

Investors prefer focusing on transactions that take place in the open market, indicated in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S indicates a sale. Transaction code C indicates the conversion of an option, and transaction code A indicates the insider may have been forced to sell shares in order to receive compensation that had been promised upon being hired by the company.

Check Out The Full List Of Arthur J. Gallagher's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.