Insiders have been selling these 3 ASX shares: Should you?

Yesterday I looked at a few shares that have experienced insider buying recently.

As I mentioned at the time, insider buying is often regarded as a bullish indicator as few should know a company better than a director. So, if they have confidence to buy shares, it could be a sign that things are going well.

When directors sell shares, however, this is often regarded as a bearish indicator.

With that in mind, here are three shares which have experienced notable insider selling this week:

Bega Cheese Ltd (ASX: BGA)

According to a change of director’s interest notice, non-executive director Richard Cross has sold 35,000 shares on-market for a total of $245,000. This has left Mr Cross with an interest of 240,058 shares. No reason has been given for the sale, but I don’t think shareholders should be overly concerned by the sale. Mr Cross retains a significant holding and I feel confident his interests are firmly aligned with shareholders.

Northern Star Resources Ltd (ASX: NST)

Founding chairman and non-executive director, Christopher Rowe, has offloaded 250,000 shares on-market according to a change of director’s interest notice. He sold his shares for an average price of $6.578 per share, equating to a combined value of approximately $1.6 million. Mr Rowe still has a considerable holding amounting to approximately 1.75 million shares. Whilst I wouldn’t be too alarmed by this sizeable sale, it does add to my bearish view on the gold miners. I would recommend investors stay clear or Northern Star given the outlook for rate rises in the United States.

SEEK Limited (ASX: SEK)

A change of director’s interest notice reveals that non-executive chairman Neil Chatfield has sold 10,000 shares on market for a total of $208,000. This equated to approximately 27% of Mr Chatfield’s holding and leaves him with an interest of 26,656 shares. Considering there are concerns floating around about Google For Jobs launching in Australia and disrupting its business model, this share sale doesn’t fill me with a lot of confidence. Shareholders might want to consider following suit and trimming down their holdings.

If you do sell some of your SEEK shares, I would suggest you reinvest the funds into one of these top stocks.

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Motley Fool contributor James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia has recommended SEEK Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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