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Insider Buys LiveXLive Media's Stock

Shares of LiveXLive Media Inc (NASDAQ:LIVX) rose by 3.3% from the previous closing price. Spengler Tim J. filed a Form 4 with the SEC on Monday, August 17. The insider bought 10,000 shares at an average price of $2.74. After the transaction, the executive'

Benzinga · 08/17/2020 18:13

Shares of LiveXLive Media Inc (NASDAQ:LIVX) rose by 3.3% from the previous closing price. Spengler Tim J. filed a Form 4 with the SEC on Monday, August 17. The insider bought 10,000 shares at an average price of $2.74. After the transaction, the executive's stake in LiveXLive Media Inc. moved to 76,667 shares.

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."

Transaction Codes To Focus On

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. 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.