Multiple insiders secured a larger position in Westgold Resources Limited (ASX:WGX) shares over the last 12 months. This is reassuring as this suggests that insiders have increased optimism about the company's prospects.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Westgold Resources

The Last 12 Months Of Insider Transactions At Westgold Resources

The insider Leigh Junk made the biggest insider purchase in the last 12 months. That single transaction was for AU$8.6m worth of shares at a price of AU$2.68 each. So it's clear an insider wanted to buy, at around the current price, which is AU$2.70. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider purchases were made at close to current prices. We note that Leigh Junk was both the biggest buyer and the biggest seller.

In the last twelve months insiders purchased 6.41m shares for AU$17m. But insiders sold 3.20m shares worth AU$8.5m. In total, Westgold Resources insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Are Westgold Resources Insiders Buying Or Selling?

In the last quarter there were insider sales totalling AU$8.5m. However that only slightly eclipses the AU$8.5m worth of purchases. Looking at the net result, we don't think this recent trading sheds much light on how insiders, as a group, are feeling about the company's prospects.

Insider Ownership

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. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own AU$2.9m worth of Westgold Resources stock, about 0.1% of the company. I generally like to see higher levels of ownership.

So What Does This Data Suggest About Westgold Resources Insiders?

Insider selling has just outweighed insider buying in the last three months. But the difference is small, and thus, not concerning. On a brighter note, the transactions over the last year are encouraging. We'd like to see bigger individual holdings. However, we don't see anything to make us think Westgold Resources insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Westgold Resources. To help with this, we've discovered 2 warning signs (1 can't be ignored!) that you ought to be aware of before buying any shares in Westgold Resources.

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.

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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.