Saba Capital Management, L.P. filed a Form 4 with the SEC on Thursday, November 19. The insider bought 72,720 shares of Invesco Dynamic Credit Opportunities Fund (NYSE:VTA) at $9.80 on Tuesday, Nov 17, and bought 40,559 shares at $9.92 on Wednesday, Nov 18. . After the transactions, the executive's stake in Invesco Dynamic Credit Inc. movedto 8,076,496 shares. Invesco Dynamic Credit Opportunities Fund was trading 0.2% 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.
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 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.