Eaton Jonathan: insider trades

Officer at LPL Financial Holdings Inc. No open-market purchases and 45 sales not made under a pre-set plan, reported from November 19, 2010 to May 2, 2012.

What happened after Eaton Jonathan’s sales?

After their sales, the shares moved −11.9% against the index over 12 months on average (a negative figure means selling was the right call); 96% trailed it.

With 296 insiders tested, some will look skilled or unskilled by chance alone: when we replaced each insider’s stocks with random companies bought on the same days, about 5.7 cleared the bar ahead and 23.3 behind. One record on its own proves little.

Trade by trade

Eaton Jonathan: trades against the S&P 500 afterwards
Measured	Trades counted	Average vs S&P 500	Median	Went the right way	Years	t-statistic	p-value	Evidence
Purchases, 3 months after the report	0	—	—	—	—	—	—	Not enough years
Purchases, 6 months after the report	0	—	—	—	—	—	—	Not enough years
Purchases, 12 months after the report	0	—	—	—	—	—	—	Not enough years
Purchases, 12 months after the trade	0	—	—	—	—	—	—	Not enough years
Sales, 3 months after the report	45	−0.2%	+1.6%	42%	3	—	—	Not enough years
Sales, 12 months after the report	45	−11.9%	−11.3%	96%	3	—	—	Not enough years
Sales, 12 months after the trade	44	−11.5%	−12.3%	93%	2	—	—	Not enough years

“Average vs S&P 500” is the stock’s return including dividends minus the index’s over the same dates, from the close on the first trading day after the report, or from the close on the trade date. Only windows that have finished are counted. For sales, a negative figure means the stock lagged after it was sold, so selling was the right call (green). “Went the right way” is the share of purchases that beat the index, or of sales that trailed it. The t-statistic uses one average per year of reports, because one person’s trades bunch into the same stock and weeks, and needs trades in at least four different years; the p-value comes from the t distribution with that number of years (with four years, a t of 2 has p = 0.14). “Some evidence” means p under 5%, “strong evidence” p under 1% over at least six years.

Companies traded

Company	Title on the latest filing	Purchases	Sales	First report	Latest report
LPL Financial Holdings Inc. LPLA	MD, Custom Clearing Services	0	45	November 19, 2010	May 2, 2012

Trades and what followed

Moves are against the S&P 500; green means the trade went the insider’s way.

Reported	Traded	Company	Trade	Value	3 months after report	12 months after report	12 months after trade
May 2, 2012	April 30, 2012	LPLA	Sale	$44,625	−14.3%	−7.9%	−13.4%
April 10, 2012	April 9, 2012	LPLA	Sale	$46,800	−0.3%	−17.5%	−19.0%
April 4, 2012	April 2, 2012	LPLA	Sale	$272,092	−3.3%	−20.1%	−19.2%
March 26, 2012	March 26, 2012	LPLA	Sale	$47,025	−3.2%	−22.4%	−21.9%
March 20, 2012	March 19, 2012	LPLA	Sale	$46,125	−2.9%	−24.0%	−17.7%
March 13, 2012	March 9, 2012	LPLA	Sale	$1,988,788	+1.5%	−18.3%	−19.6%
March 6, 2012	March 5, 2012	LPLA	Sale	$42,188	+1.7%	−17.3%	−14.4%
February 29, 2012	February 27, 2012	LPLA	Sale	$40,688	+3.4%	−19.4%	−10.9%
February 22, 2012	February 21, 2012	LPLA	Sale	$41,125	+2.6%	−9.7%	−9.9%
February 14, 2012	February 13, 2012	LPLA	Sale	$40,825	+4.6%	−6.3%	−7.4%
January 31, 2012	January 30, 2012	LPLA	Sale	$40,662	−3.0%	−10.6%	−7.3%
January 24, 2012	January 23, 2012	LPLA	Sale	$43,075	+6.0%	−13.0%	−22.3%
January 18, 2012	January 17, 2012	LPLA	Sale	$41,850	+1.9%	−23.8%	−22.3%
January 10, 2012	January 9, 2012	LPLA	Sale	$38,588	+4.4%	−20.1%	−15.6%
January 4, 2012	January 3, 2012	LPLA	Sale	$38,462	+14.3%	−13.1%	−14.8%
December 29, 2011	December 27, 2011	LPLA	Sale	$36,712	+11.0%	−16.0%	−12.4%
December 20, 2011	December 19, 2011	LPLA	Sale	$35,225	+15.4%	−14.0%	−15.7%
December 13, 2011	December 12, 2011	LPLA	Sale	$36,150	+18.3%	−10.8%	−12.3%
December 6, 2011	December 5, 2011	LPLA	Sale	$37,762	+13.3%	−13.7%	−13.8%
November 30, 2011	November 28, 2011	LPLA	Sale	$34,738	+2.4%	−15.7%	−17.9%
November 23, 2011	November 21, 2011	LPLA	Sale	$35,088	+4.7%	−19.1%	−18.6%
November 15, 2011	November 14, 2011	LPLA	Sale	$35,488	+4.5%	−17.5%	−16.4%
November 8, 2011	November 7, 2011	LPLA	Sale	$36,038	+3.8%	−8.9%	−8.5%
November 2, 2011	October 31, 2011	LPLA	Sale	$35,838	+11.7%	−9.8%	−8.3%
October 11, 2011	October 10, 2011	LPLA	Sale	$32,750	+11.7%	−9.9%	−7.0%
October 4, 2011	October 3, 2011	LPLA	Sale	$31,525	+3.8%	−11.3%	−13.0%
September 27, 2011	September 26, 2011	LPLA	Sale	$31,250	+9.8%	−7.8%	−9.6%
September 20, 2011	September 19, 2011	LPLA	Sale	$31,725	+11.2%	−1.0%	+0.6%
September 13, 2011	September 12, 2011	LPLA	Sale	$31,250	+5.3%	−1.9%	−1.1%
September 6, 2011	September 6, 2011	LPLA	Sale	$33,362	+4.5%	−6.9%	−6.8%
August 31, 2011	August 29, 2011	LPLA	Sale	$34,675	+1.0%	−12.3%	−13.3%
August 22, 2011	August 22, 2011	LPLA	Sale	$34,350	−5.9%	−20.8%	−17.8%
August 16, 2011	August 15, 2011	LPLA	Sale	$34,400	+1.3%	−8.9%	−5.9%
August 8, 2011	August 8, 2011	LPLA	Sale	$38,200	−6.5%	−16.2%	−20.3%
August 3, 2011	August 1, 2011	LPLA	Sale	$41,200	−12.4%	−25.8%	−20.6%
July 12, 2011	July 11, 2011	LPLA	Sale	$41,825	−12.2%	+3.7%	+3.9%
July 6, 2011	July 5, 2011	LPLA	Sale	$42,762	−8.7%	+1.4%	+1.1%
June 28, 2011	June 27, 2011	LPLA	Sale	$41,425	−15.5%	−0.7%	−2.3%
June 21, 2011	June 20, 2011	LPLA	Sale	$43,112	−20.0%	−2.6%	−5.7%
June 14, 2011	June 13, 2011	LPLA	Sale	$43,312	−18.3%	−3.5%	−3.2%
June 7, 2011	June 6, 2011	LPLA	Sale	$44,800	−19.2%	−7.3%	−8.5%
June 2, 2011	May 31, 2011	LPLA	Sale	$44,400	−13.8%	−7.1%	−6.4%
May 24, 2011	May 23, 2011	LPLA	Sale	$42,588	−6.3%	−6.2%	−5.1%
May 19, 2011	May 18, 2011	LPLA	Sale	$42,462	−8.0%	−6.3%	−7.1%
November 19, 2010	November 17, 2010	LPLA	Sale	$14,522,220	−9.7%	−13.6%	not yet

Open-market purchases and sales of at least $10,000 in companies we cover, from SEC Form 4 filings; sales made under a pre-set Rule 10b5-1 plan are not shown. “Not yet” means the window has not finished or the share price was under $5 at entry. These are the shares’ moves after each trade: they say nothing about why Eaton Jonathan traded and do not suggest the use of non-public information. How every insider compares · the insider trading backtest.