insider selling

Definition

Selling of a company's stock by individual directors, executives or other employees. While selling of small amounts of stock is quite common and should not necessarily be a cause for alarm, selling of large amounts of stock is sometimes interpreted by investors as a sign that the insiders know something negative about the company's future. Insider selling which is based on insider information is illegal. The SEC has set up a rule by which insiders may sell specific amounts of their holdings at specific times, and this information is recorded for public scrutiny in the annual report.
opposite of insider buying.

Related Terms

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insider report insider trading