Benzinga | Jul 17, 2020 10:36AM EDT

Insider Buys Cryo-Cell International Stock

Cryo-Cell International Inc (OTC:CCEL) was trading 4.65% lower from the previous closing price. A Form 4 filing filed with the SEC on Wednesday, July 15 showed that Berger Harold D. bought 971 shares at $7.63 on Monday, Jul 13, and bought 700 shares at $7.65 on Tuesday, Jul 14.The transaction moved the executive's stake in Cryo-Cell International Inc. to 27,101 shares.

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.

When an insider buys stock after an important sell off, that can indicate the insider's faith in the success of the organization. Henceforth, if the stock is bought at new highs, it might be because the insider feels that the stock is not 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

Investors prefer focusing on transactions which take place in the open market, indicated in the Form 4 with 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 besides P or S aren't relatively important as they are seldom tied to a decision by the executive. For example, transaction code A is indicative of an insider being forced to sell shares to attain compensation. Moreover, transaction code C indicates the conversion of an option.