Form 144
SEC Form 144 is a notice of proposed sale of restricted securities or securities held by affiliates. It must be filed when an insider intends to sell restricted stock or control securities, providing advance notice to the market.
The Trader's Take
The Signal
A Form 144 filing signals an upcoming sale, which can create downward pressure on stock price. However, if the sale doesn't materialize or is smaller than expected, it can be bullish.
The Noise
Many Form 144 filings are routine sales of restricted stock from compensation plans and don't indicate negative sentiment.
Actionable Insights
- 1Monitor Form 144 filings to anticipate potential selling pressure.
- 2Compare the proposed sale amount to the insider's total holdings—small sales are less significant.
- 3Watch for Form 144 filings that are never executed—this can signal the insider changed their mind.
- 4Large Form 144 filings from multiple insiders simultaneously can indicate coordinated selling.
Regulatory Context & Context
| Timing / Deadline | Reporting Requirement |
|---|---|
| Before or Concurrent | Must be filed before or at the time of placing the sell order. |
Form 144 vs Form 4
Form 144
SEC Form 144 is a notice of proposed sale of restricted securities or securities held by affiliates. It must be filed when an insider intends to sell restricted stock or control securities, providing advance notice to the market.
Form 4
An SEC Form 4 is a mandatory filing that reports changes in ownership of company stock by "insiders"—officers, directors, and any shareholder owning more than 10% of the company. It must be filed within two business days of the transaction.
Common Misconceptions
Form 144 doesn't guarantee the sale will happen—it's a notice of intent.
Not all insider sales require Form 144—only restricted securities and control securities.
Form 144 is different from Form 4, which reports completed transactions.
Frequently Asked Questions
What is the difference between Form 144 and Form 4?
Form 144 is a notice of proposed sale, while Form 4 reports completed transactions. Form 144 is filed before selling restricted securities, while Form 4 is filed after any insider transaction.
Does Form 144 mean the insider will definitely sell?
No, Form 144 is a notice of intent. The sale may not occur, or may occur in smaller amounts than indicated.