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There are many different strategies to trade stocks and one of them is to find insider trading of stocks. When corporate insiders trade in their own securities, they must report their trades to the Securities and Exchange Commission (SEC), usually within a few business days of the trade. Insider trading cannot be based on material non-public information. However, many investors believe that corporate insiders may have better insights into the growth of the company and its proceedings. While there are many reasons for insiders to sell their shares, there is only one reason to buy. That said, investors generally look for insider selling patterns to get better insights into a company.

In this article, I will focus on notable insider sell transactions from large-cap companies (market cap greater than $10 billion) filed at the Securities and Exchange Commission on August 20, 2012. I have also included the key financial metrics for the first three companies. You can use this list as a potential starting point for your analysis.

Definition of Insider: Corporate insiders are either a company's officers, directors, or any beneficial owners of more than ten percent of a class of the company's equity securities registered under Section 12 of the Securities Exchange Act of 1934.

Rule 10b5-1 Definition: A rule established by the SEC that allows insiders of publicly-traded corporations to create a trading plan of whenand how to buy or sell shares in that company. Rule 10b5-1 allows major holders to buy or sell a predetermined number of shares at a predetermined time. 10b5-1 plans are used by many corporate insiders to avoid the accusations of insider trading, regardless of what nonpublic knowledge he/she may later come to possess.

1. The Charles Schwab Corporation (SCHW): The Charles Schwab Corporation provides securities brokerage, banking, and related financial services to individuals and institutional clients. Charles Schwab has a market cap of $16.74 billion and is currently trading around $13.14 with a 52-week range of $10.56 to $15.53. The stock has gained 16.7% year to date.

According to SEC filings on August 20, 2012, Schwab Charles R (Chairman) sold a total of 1,500,000 shares at a total value of $19,811,800. Over the past three months, there have been a total of 13 insider transactions with 11 Sell transactions. The key financial metrics for Charles Schwab are given below:

The following chart provides the insider trading summary for three-month and 12-month periods.

2. Northrop Grumman Corporation (NOC): Northrop Grumman provides products, services, and solutions in aerospace, electronics, information systems, and technical services worldwide. Northrop Grumman has a market cap of $17.24 billion and is currently trading around $69.75 with a 52-week range of $49.20 to $69.88. The stock has gained 19.27% year to date.

According to SEC filings on August 20, 2012, Pitts James F (Corporate Vice President and President of Electronic Systems) sold a total of 19,000 shares at a total value of $1,313,280. Over the past three months, there have been a total of 28 insider transactions with 13 Sell transactions. The key financial metrics for Northrop Grumman are given below:

The following chart provides the insider trading summary for three-month and 12-month periods.

3. Ameriprise Financial, Inc (AMP): Ameriprise Financial provides a range of financial products and services in the United States and internationally. Ameriprise Financial has a market cap of $11.59 billion and is currently trading around $55 with a 52-week range of $36.00 to $58.68. The stock has gained 10.8% year to date.

According to SEC filings on August 20, 2012, Truscott William F (CEO, U.S. Asset Management) sold a total of 20,000 shares at a total value of $1,100,000. Over the past three months, there have been a total of 8 insider transactions and all of them are Sell transactions. The key financial metrics for Ameriprise Financial are given below:

The following chart provides the insider trading summary for three-month and 12-month periods.

Other notable insider selling transactions (minimum transaction value of $350,000) from large-cap companies filed at the SEC on August 20, 2012, are as follows:

4. TE Connectivity Ltd (TEL): TE Connectivity Ltd engages in the design and manufacture of products that connect and protect the flow of power and data inside various products used by consumers and industries. TE Connectivity has a market cap of $15.29 billion and is currently trading around $35.75 with a 52-week range of $26.58 to $37.69. The stock has gained 16.03% year to date. According to SEC filings on August 20, 2012, TE Connectivity had two insiders combined sell a total of 20,076 shares at a total value of $714,972. Multiple insider selling are usually a negative sign.

5. The Gap Inc (GPS): The Gap Inc operates as a specialty retailer and the company offers apparel, accessories, and personal care products for men, women, children, and babies under the Gap, Old Navy, Banana Republic, Piperlime, and Athleta brand names. Gap Inc has a market cap of $17.29 billion and is currently trading around $35.34 with a 52-week range of $15.08 to $36.23. The stock has gained 90.51% year to date. According to SEC filings on August 20, 2012, Banks Michelle (EVP & General Counsel) sold a total of 20,000 shares at a total value of $712,500, through Rule 10b5-1 trading plan.

6. Exxon Mobil Corporation (XOM): Exxon Mobil Corporation engages in the exploration and production of crude oil and natural gas, and manufacture of petroleum products, as well as transportation and sale of crude oil, natural gas, and petroleum products. Exxon Mobil has a market cap of $405.97 billion and is currently trading around $87.95 with a 52-week range of $67.93 to $88.91. The stock has gained 3.76% year to date. According to SEC filings on August 20, 2012, Kelly Alan J (Vice President) sold a total of 5,850 shares at a total value of $517,275.

7. Estee Lauder Companies Inc (EL): The Estee Lauder Companies engages in the manufacture, marketing, and sale of skin care, makeup, fragrance, and hair care products worldwide. Estee Lauder Companies has a market cap of $23.55 billion and is currently trading around $60.59 with a 52-week range of $40.76 to $65.60. The stock has gained 7.89% year to date. According to SEC filings on August 20, 2012, Estee Lauder Companies had two insiders combined sell a total of 7,156 shares at a total value of $439,401.

8. Dollar Tree, Inc (DLTR): Dollar Tree operates discount variety stores in the United States and Canada. Its stores offer merchandise at the fixed price of $1.00. Dollar Tree has a market cap of $11.29 billion and is currently trading around $48.67 with a 52-week range of $32.00 to $56.81. The stock has gained 17.11% year to date. According to SEC filings on August 20, 2012, Rudman Robert H (Chief Merchandising Officer) sold a total of 7,464 shares at a total value of $367,229, through a Rule 10b5-1(c)(1) trading plan.

Sources: Some of the data is sourced from Google Finance, Nasdaq, Finviz, Fidelity, and SEC.gov.

Additional Disclosure: I change my positions very frequently and may initiate either long or short positions in the above mentioned stocks at any time.

Disclaimer: I am not a registered investment advisor and do not provide specific investment advice. The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. It is up to investors to make the correct decision after necessary research. The information and data is believed to be accurate, but no guarantees or representations are made.

Source: Notable Large-Cap Insider Sells Filed On August 20