Form 4 transaction codes, explained
Every transaction on an SEC Form 4 carries a one-letter code describing what actually happened. This is the difference between an insider spending millions of their own dollars and an insider passively receiving their annual stock award — two events that look similar in raw data and mean completely different things.
POpen-market purchase
The insider bought shares on the open market with their own money. Widely considered the most informative insider transaction — especially when the amount is large relative to the insider's compensation, or when several insiders buy within days of each other.
SOpen-market sale
The insider sold shares on the open market. Meaningful in size or clusters, but noisy on its own: insiders sell to diversify, fund purchases, or pay taxes. Many sales also happen under pre-scheduled 10b5-1 plans.
AGrant / award
Shares granted as compensation — the insider paid nothing. This is routine pay mechanics, not a decision to buy, and should never be read as an open-market purchase.
FTax withholding
Shares withheld or surrendered to cover taxes when restricted stock vests. In raw data this looks like a sale — it isn't a discretionary one. Tools that mark code F as a 'sell signal' are misleading you.
MOption exercise
The insider converted stock options into shares. Usually compensation mechanics rather than a market view. What matters more is what happens next: do they keep the shares or immediately sell them?
GGift / transfer
Shares gifted — commonly to family trusts or charities. Estate and tax planning, not a buy or sell signal.
DDisposition to issuer
Shares returned to the company itself, e.g. in a buyback of insider stock. Context-dependent — read the footnotes.
JOther (footnote-dependent)
A catch-all code whose meaning depends entirely on the filing's footnotes. Always open the original document for these.
The practical takeaway
When you scan insider activity, separate discretionary trades (P, and to a lesser degree S) from compensation mechanics (A, F, M) and planning transfers (G). Nortis does this classification automatically and labels each filing accordingly, so a tax-withholding event never masquerades as an insider dumping stock.
Disclaimer: Educational content only — not investment advice. Always verify against the original SEC filing.