form4 cfo only
What it checks
When the CFO personally buys their own company's stock — at least $100k — the stock tends to outperform over the next 2-4 months.
Mechanism
CFOs have direct line-of-sight into revenue recognition, working-capital quality, off-balance-sheet exposures. Their Form-4 purchases are systematically more informative than CEO trades.
Signal rule
long on Form-4 CFO purchase (transaction_code='P' AND insider_title contains CFO/Chief Financial) >=$100k; hold 60/90/120 days
Data dependencies
sec_insider_tradesForm-4 insider transactions with role, size, and trade direction.
daily_pricesAdjusted-close OHLCV for every US-listed ticker; primary price feed.
Expected edge
- Paper alpha
- ~2-4% over 60-120d
- Paper window
- T+0 to T+120d
Wang-Shin-Francis 2012: 2-4% abnormal return over 60-120d on single-CFO purchases.
Example tickers where this is likely to fire
Illustrative only — the signal fires based on the live data, not a fixed list.
Related families
insider form4Insider-ActivityLakonishok-Lee 2001, Cohen-Malloy-Pomorski 2012: corroborated insider purchases (Form 4 transaction_code='P') from multiple insiders within a short window are the single most-predictive insider signal — ~6%/year alpha over 6-12 months. Single-insider buys are noisy; cluster buys (3+ distinct insiders, or a single buy > $1M from CEO/CFO) are not. Long for 60 days on cluster buys; long for 30 days on a single $1M+ transaction. Sales are deliberately ignored — they're confounded by liquidity, diversification, and options expiry.
insider 10b51 planInsiderForm 4 footnotes referencing 10b5-1 plans flag pre-scheduled insider sales; cancellations bullish.
item 502 executive departureEvent8-K Item 5.02 (Departure/Appointment of Officers). Fee et al find ~-3% abnormal return on the 8-K filing window, holding through 60d. Forced departures stronger (-5% to -15%).
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