What a Form 4 is

Who files one

A Form 4 is a report a company insider sends to the SEC, the government agency that oversees the stock market, when they buy or sell their own company's stock. Insiders are the company's top officers, its board members, and anyone who owns more than ten percent of its shares. Section 16 of a law called the Securities Exchange Act says who counts.

Funds and other companies file too when they own more than ten percent. That is why a fund can show up on Paydirt next to a chief executive.

The job title on a Paydirt profile is copied from the report itself, like chief executive officer, director, or ten percent owner. Paydirt does not guess anyone's role.

The two-business-day deadline

A Form 4 is due within two business days of the trade, under the SEC's Rule 16a-3. Paydirt counts business days the way the SEC does: weekdays, minus United States federal holidays. That is not quite the same as the days the stock market is open. For example, the market is closed on Good Friday, but the SEC counts it as a business day.

Under SEC filing rules, reports sent to EDGAR, the SEC's public filing website, by 10 PM Eastern get that day's date. The date on the report is the date Paydirt shows.

What a row shows

Each row on Paydirt is one report, one side (a buy or a sale), and one company. One report often splits a single purchase into many smaller pieces bought at different prices, called lots. Paydirt adds the lots together and tells you how many there were.

The dollar amount is shares times price as filed, and the line under it says so. Every row shows the day of the trade, the day of the report, and the number of days in between. Only purchases and sales, codes P and S, are listed; the Form 4 codes guide explains the rest.

People make mistakes on these forms. Sometimes they type the total cost of a trade where the price of one share should go. When a filed price is far from the stock's real price that day, Paydirt shows the number of shares but no dollar amount, with the label price not plausible. It does this instead of showing math on a number it believes is wrong.

What the late marker means

A report marked late was filed more than two business days after the trade. The marker says how many days late, and nothing more. Some reports can be late without breaking any rule, for example trades made under a plan set up ahead of time under Rule 10b5-1. So the late marker is a fact about the dates, never a claim that a rule was broken.

Reading the original

Every row links to the original report on SEC EDGAR. All insider trades are on the insider feed. The companies with the most reports are on the tickers page. How Paydirt measures returns on these trades is in the returns guide.