What Is SEC Form 4?
SEC Form 4 is the filing that reveals when a CEO, director, or major shareholder buys or sells their own company's stock — usually within two business days of the trade.
Form 4 is officially titled a "Statement of Changes in Beneficial Ownership." It's filed with the U.S. Securities and Exchange Commission (SEC) whenever a corporate insider trades securities in their own company. The requirement comes from Section 16 of the Securities Exchange Act of 1934, the law that governs insider reporting.
Because insiders have the deepest possible knowledge of their business, their personal trades are considered a meaningful signal — and the law requires them to be disclosed quickly and publicly.
Who has to file a Form 4?
Form 4 applies to people the SEC defines as insiders:
- Officers — executives such as the CEO, CFO, and other senior leaders.
- Directors — members of the company's board.
- 10% owners — any person or entity that beneficially owns more than 10% of a class of the company's equity securities.
What a Form 4 reports
Each Form 4 lays out the specifics of the transaction: the insider's name and relationship to the company, the security involved, the date, the number of shares, the price, and the insider's resulting ownership. Filings are submitted electronically and published on the SEC's EDGAR database, free for anyone to read.
How to read Form 4 transaction codes
Every transaction carries a one-letter code. A few you'll see often:
| Code | Meaning | Why it matters |
|---|---|---|
| P | Open-market purchase | Insider spent their own money buying shares — often read as conviction. |
| S | Open-market sale | Insider sold shares; can be routine (diversification) or a warning. |
| A | Grant or award | Shares received as compensation, not an open-market buy. |
| M | Option exercise | Insider converted options into shares. |
Investors typically pay closest attention to "P" (open-market purchases), because an insider choosing to spend their own cash on shares is a deliberate, optional act — unlike a scheduled sale or a compensation grant.
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Frequently asked questions
What is SEC Form 4?
A "Statement of Changes in Beneficial Ownership" that corporate insiders file with the SEC to report transactions in their own company's securities.
Who has to file Form 4?
Officers, directors, and beneficial owners of more than 10% of a company's equity securities — insiders under Section 16 of the Securities Exchange Act of 1934.
How quickly must Form 4 be filed?
Within two business days of the transaction. Filings are published on the SEC's EDGAR system.
What do Form 4 transaction codes mean?
"P" is an open-market purchase, "S" is a sale, "A" is a grant or award, and "M" is an option exercise. Open-market purchases are often watched most closely.