Insiders who bought Arts Optical International Holdings Limited (HKG:1120) stock in the last 12 months were richly rewarded last week. The company's market value increased by HK$50m as a result of the stock's 13% gain over the same period. As a result, the stock they originally bought for HK$13.0m is now worth HK$17.6m.

Although we don't think shareholders should simply follow insider transactions, 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 Arts Optical International Holdings

The Executive Director Kim Ying Ng made the biggest insider purchase in the last 12 months. That single transaction was for HK$2.5m worth of shares at a price of HK$0.83 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of HK$1.14. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Arts Optical International Holdings insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Check out our latest analysis for Arts Optical International Holdings

Arts Optical International Holdings is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership Of Arts Optical International Holdings

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Arts Optical International Holdings insiders own 74% of the company, currently worth about HK$324m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Arts Optical International Holdings Insider Transactions Indicate?

The fact that there have been no Arts Optical International Holdings insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. It would be great to see more insider buying, but overall it seems like Arts Optical International Holdings insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To help with this, we've discovered 3 warning signs (1 can't be ignored!) that you ought to be aware of before buying any shares in Arts Optical International Holdings.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.