What are directors dealings?
Directors’ dealings are the purchases and sales made by directors of shares in the publicly quoted companies for which they work. It is perfectly legal for directors to buy or sell shares in their own company provided certain rules are observed. The theory is that directors’ dealings indicate what the people running the company think about its share price. Put crudely, if the Directors are buying, they think the shares are undervalued; if they are selling, they think the shares are overvalued. It follows that by doing what the directors do, you will be on the right side of a share price movement. But of course it’s not quite as simple as that . . .
Related Questions
- What evidence is there that directors dealings are a positive indicator of share price movements? By the time I read about directors dealings, is it too late?
- What is the difference between a nominee director and an alternate director? What is the duty of an alternate director?
- What are directors dealings?
