Looking at China Water Affairs Group Limited's (HKG:855 ) insider transactions over the last year, we can see that insiders were net sellers. That is, there were more number of shares sold by insiders than there were purchased.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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The Last 12 Months Of Insider Transactions At China Water Affairs Group

Notably, that recent purchase by Executive Chairman Chuan Liang Duan was not the only time they traded China Water Affairs Group shares this year. Earlier in the year, they sold shares at a price ofHK$5.00 per share in a -HK$137m transaction. That means that an insider was selling shares at slightly below the current price (HK$6.18). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 5.8% of Chuan Liang Duan's holding.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for China Water Affairs Group

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Insiders At China Water Affairs Group Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at China Water Affairs Group. Executive Chairman Chuan Liang Duan spent HK$19m on stock, and there wasn't any selling. That shows some optimism about the company's future.

Does China Water Affairs Group Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. China Water Affairs Group insiders own 31% of the company, currently worth about HK$3.2b based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At China Water Affairs Group Tell Us?

It's certainly positive to see the recent insider purchase. However, the longer term transactions are not so encouraging. The recent buying by an insider , along with high insider ownership, suggest that China Water Affairs Group insiders are fairly aligned, and optimistic. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 2 warning signs for China Water Affairs Group (1 makes us a bit uncomfortable!) and we strongly recommend you look at them before investing.

Of course China Water Affairs Group may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.