Form4 uses three independent grades to evaluate insider trading signals. Each answers a different question:
Insider Rating
WHO they are — how this insider's own past buys performed. One rating per person, per company.
Tags
WHAT HAPPENED. Facts about the filing — bought a dip, first purchase, unusually large. A filing carries as many as apply, and they never rate it.
Trade Rating
HOW NOTABLE this one filing is. Twelve factors, including the insider's rating. One rating per filing.
A+ / A / B / C / D / New
Every insider with observable buy trades receives a point-in-time (PIT) career score. It uses the full history of trades whose forward returns are knowable as of the scoring date — no look-ahead bias. The score uses a 5-year half-life decay, so old trades retain meaningful weight and an insider who was strong historically doesn't lose grade just because they've been quiet recently.
| Rating | Share | Avg 30d vs S&P | Win rate | What it means |
|---|---|---|---|---|
| A+ | 3.2% | +4.88% | 53.7% | The top 3%. Their buys beat the market by the widest margin we measure. |
| A | 4.0% | +2.00% | 48.5% | A consistent record of buying ahead of gains. |
| B | 15.1% | +0.41% | 47.0% | Slightly better than the market on average. |
| C | 65.6% | −0.25% | 45.1% | Measured, and no better than the market. |
| Unrated | 12.1% | +1.41% | 46.1% | Not enough history at this company to judge — and not a bad sign. Unrated buys have beaten every graded tier below A. |
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A+ / A / B / C / D / New
Same Bayesian framework as Career Grade, but with a 1.5-year half-life. Captures whether the insider is currently in form — their recent trades dominate the score, older trades fade.
An insider who's been quiet for 4+ years can have strong Career, weak Recent Form. An insider who's been hot lately but historically mediocre is the opposite. The two grades together tell you both the long-run skill and the short-run state.
Form4's strategies use whichever grade empirically performs best in backtests for that specific signal. Quality-momentum and reversal-dip filter on Career Grade; 10b5-1 surprise filters on Recent Form.
Career Grades are computed per ticker because an insider's information advantage depends on which company they serve.
On individual trade rows, you see the grade for that specific ticker at the time of the trade. On the Leaderboard you see the insider's best grade across all tickers.
1 to 5 stars
Every filing is scored on twelve factors — including the insider's own rating — and lands in one of five bands. Figures below are measured from the first close after the filing was public, not from the transaction date.
| Rating | Share | Avg 30d vs S&P | Win rate | What it means |
|---|---|---|---|---|
| Exceptional | 1.4% | +2.74% | 50.1% | Several strong factors at once. The rarest rating we give. |
| Strong | 11.3% | +1.88% | 49.8% | Clearly above the average filing. |
| Notable | 34.5% | +0.73% | 47.8% | Something here stands out, but not much. |
| Modest | 35.1% | +0.12% | 44.4% | Nothing distinguishes this filing. |
| Weak | 17.6% | −1.35% | 42.7% | Negative factors outweigh the positive ones. |
| # | Factor | What It Measures |
|---|---|---|
| 1 | Insider PIT Grade | The insider's point-in-time quality grade at the time of the trade |
| 2 | Role | C-suite at primary company weighted more heavily |
| 3 | Cluster Size | Multiple insiders buying the same stock within a short window |
| 4 | Dip Depth | Stock is trading well below recent highs — potential value opportunity |
| 5 | Opportunistic | Trade appears discretionary rather than part of a compensation plan |
| 6 | Pre-Planned (negative) | 10b5-1 plan trades are less informative — penalized |
| 7 | Routine (negative) | Regular periodic buying patterns suggest non-signal trades — penalized |
| 8 | Rare Reversal | Insider who typically sells is now buying — unusual conviction |
| 9 | Holdings Increase | The purchase meaningfully increases the insider's position size |
| 10 | Trade Value | Larger dollar amounts signal stronger conviction |
| 11 | 52-Week Proximity | Buying near 52-week highs signals confidence — validated by Lasfer 2024 (12.8% annual alpha) |
| 12 | Largest Ever | This is the insider's largest-ever purchase in this stock |
The strongest signals come from trades where both grades are high: an A-rated insider making a 5-star trade. But the two grades are intentionally independent — a new insider with no history can still have a high Trade Grade if the transaction characteristics are strong.
On the Feed, you can filter by both grades to find the intersection that matches your conviction level.
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