What is Form 4?
Form 4 is the report a company insider files with the SEC when their holdings of the company's stock change. Insiders are officers, directors and anyone who owns more than 10% of a class of the company's shares. Each line on the form records one transaction: the date, the number of shares, the price, whether shares were acquired or disposed of, and a one-letter transaction code that says how.
How fast insiders must report
- Insider tradesBuys, sells, exercises, receives a grant≤ 2 business days
- Form 4 on EDGAROne line per transaction, with a codewithin the hour
- Scored by SignalXClusters, CEO buys, large sales
Most insiders meet the deadline. In the 90 days to October 2026, about 5% of the transactions SignalX parsed were reported more than four calendar days after the trade, which is worth noting when an important purchase or sale shows up late.
How often each code appears
The raw Form 4 feed is dominated by compensation. Across 250,535 non-derivative transactions SignalX parsed with trade dates from October 2025 through September 2026, sales were the largest group, followed by grants, tax withholding and option exercises. Open-market purchases were less than one in fourteen.
Share of non-derivative Form 4 transactions by code · Oct 2025 to Sep 2026
- SSaleSale32.8% · 82,201
- AGrant or awardGrant or award21.2% · 53,035
- FTax withholdingTax withholding17.0% · 42,589
- MOption exerciseOption exercise14.3% · 35,795
- PPurchasePurchase6.8% · 17,117
- GGiftGift2.0% · 4,941
Every transaction code
These are the codes you will see most often, and how much each one tells you about an insider's view of the stock.
| Code | Meaning | Signal value |
|---|---|---|
| P | Open-market or private purchase The insider bought shares, usually with their own money. | Strong signal |
| S | Open-market or private sale The insider sold shares. Many reasons, so read it in context. | Read in context |
| A | Grant or award Shares or options granted by the company, typically compensation. | Little signal |
| M | Exercise or conversion of a derivative Stock options or units turned into shares. | Little signal |
| F | Tax or exercise-price withholding Shares withheld or delivered to pay tax or an option's strike price. | Little signal |
| G | Gift Shares given away, often to family, trusts or charity. Reported on Form 4 since 2023. | Little signal |
| D | Disposition to the issuer Shares returned to the company, for example in a buyback or forfeiture. | Read in context |
| C | Conversion of a derivative A convertible security converted into common stock. | Little signal |
| X | Exercise of an in-the-money derivative An option exercised when it is in the money. | Little signal |
| J | Other acquisition or disposition A catch-all. The footnotes explain what happened. | Read in context |
| W | Acquisition or disposition by will Shares received or transferred through inheritance. | Little signal |
Less common codes include L (small acquisitions), I (discretionary transactions under an employee benefit plan), K (equity swaps) and V (transactions reported voluntarily, ahead of the deadline). When in doubt, the footnotes at the bottom of the form explain each line.
How to read a Form 4
- Check the reporting person and relationship. Is it the CEO, the CFO, a director or a 10% owner? A fund that owns 10% trades for very different reasons than a CFO.
- Read Table I first. It lists non-derivative transactions, meaning common stock. Table II covers options, warrants and other derivatives.
- Find the code, shares, price and A or D. A means acquired, D means disposed. The code tells you how.
- Look at shares owned after the transaction. A purchase that doubles an insider's stake means more than one that adds 1%.
- Read the footnotes. They explain price ranges, weighted averages, indirect ownership through trusts and whether a trade came from a trading plan.
The 10b5-1 checkbox
Since April 2023, Form 4 has a checkbox showing that a transaction was made under a Rule 10b5-1 trading plan, a pre-arranged schedule set up in advance. Planned sales were decided months earlier and carry little information about the insider's current view. Our guide to insider selling and 10b5-1 plans explains how to tell planned from discretionary trades.