Sec filings что это

SEC Fillings и корпоративные новости NYSE и NASDAQ

Sec fillings – это ряд официальных документов, которые подаются в комиссию по ценным бумагам и биржам США (SEC). Все публичные компании должны предоставлять регулярные отчеты в комиссию. Для большинства профессиональных инвесторов и фондов это самые важные документы. В Sec Fillings содержится важная финансовая информация, раскрываются существенные факты и события в компании.

Некоторые SEC Fillings:

3: Initial Statement of beneficial ownership (Insider transactions) или по-русски первичный отчет о собственниках компании. Зачастую он не интересен для трейдеров.

4: Statement of changes in beneficial ownership (Insider transactions). Это уведомлении о продаже или покупке акций инсайдером. Встречается часто, но опять же для дейтрейдера от этой новости проку мало. А вот среднесрочную торговлю на анализе действий инсайдеров строить можно. Но тут нужен свой подход.

5: Annual statement of changes in beneficial ownership (Insider transactions) Ежегодный отчет о том как потороговали инсайдеры. Толку опять же нет для дейтрейдинга.

13D: Notification of a holding of 5% or more of any class of a company’s shares by a single investor or group working together. Вот это уже интересно. Уведомление о покупке более чем 5% акций компании частным инвестором или фондом. Рынок на это всегда реагирует мегапозитивно, правда иногда потом гэпы закрываются. Все зависит от того, кто купил и зачем. Подробнее можно почитатьтут.

144: Report of proposed sale of securities. Тут все просто, это продажа ценных бумаг. Чаще всего вторичная. Если компания берет деньги на благое дело, то акции вроде как должны расти. По практике, на таких новостях акция гэпает вниз на 2-4 процента. Часто отрастает и закрывает гэп.

10-Q: Quarterly report filed pursuant to sections 13 or 15(d) Это то, что все трейдеры любят. Форма предоставления квартального отчета.

10-K: Annual report pursuant to section 13 and 15(d). Годовой аудированный отчет компании, который должен содержать финансовую отчетность, раскрытие фактов, которые могут повлиять на финансовые показатели в дальнейшем. Форма обязательна для подачи для всех публичных компаний в конце каждого финансового года. Предыдущая форма 10Q не является аудированной. Если компания не предоставит вовремя 10K, то ее могут исключить из листинга биржи. Тут все серьезно. 10Q и 10K – самые сладкие новости для дейтрейдера.

8-K: Interim report which announces any material events or corporate changes that occur between 10-Q quarterly reports. Тоже хорошая штука. Форма заполняется, когда в компании происходит значимое финансовое событие между квартальными отчетами. Например, получили крупную сделку или наоборот сильно потратились. Если встречается в новостях, то нужно прикинуть насколько событие значимое для компании чтобы понять степень возможной волатильности. Для желающих покопаться линк.

Для чего все это трейдеру? Для того, чтобы найти акцию в которой вероятность заработать больше. Понимание корпоративных новостей и их влияние на цену акции в моменте позволяет находить действительно уникальные торговые ситуации. Рынок не всегда сразу отыгрывает новости, нужно их адекватно оценивать и действовать исходя из соображений логики. Со всеми формами SEC можно ознакомиться тут: http://www.sec.gov/about/forms/secforms.htm

Все SEC Fillings есть в бесплатном доступе на официальном сайте в системе EDGAR

Естественно, пользоваться базой на сайте SEC для подготовки к торгам совершенно неудобно. Хорошее решение – качественные корпоративные новости США. Я для этого пользуюсь Briefing InPlay, но многим могут показаться интересными новости Seeking Alpha. Все удачи и хороших торгов.

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Other

The EDGAR database provides free public access to corporate information, allowing you to research a public company’s financial information and operations by reviewing the filings the company makes with the SEC. You can also research information provided by mutual funds (including money market funds), exchange-traded funds (ETFs), and variable annuities.

Where to begin?

In addition to this link, you have two ways of accessing EDGAR from the SEC.gov home page:

Form Types

EDGAR presents search results in chronological order and identifies the filings by form types, shown in the first column of the search results. For example, the form type for the annual report on Form 10-K filed by domestic public companies is “10-K.”

Filings with “/A” appended to the form type code indicate an amendment. For example, the form type “10-K/A” would indicate an amendment to a Form 10-K filing.

This guide describes where you can find certain types of information in common filings by public companies, mutual funds, and ETFs. A more comprehensive list of the types of forms filed on EDGAR can be found at this forms list.

Financial Information and Results of Operations

Domestic public companies file annual and quarterly reports, as well as current reports when certain events occur that require prompt disclosure. The annual and quarterly reports include financial statements for the relevant period.

Annual report – Provides audited annual financial statements, a discussion of material risk factors for the company and its business, and a management’s discussion and analysis of the company’s results of operations for the prior fiscal year.

Quarterly report – Provides unaudited quarterly financial statements, updates regarding material risks that the company faces, and management’s discussion and analysis of the company’s results of operations for the prior fiscal quarter.

Current report – Discloses material events or information that the company chooses or is required to make public prior to its next scheduled quarterly or annual report.

Some companies are currently filing (and soon all companies will have to file) these disclosure reports with financial information in a structured data format referred to as Inline XBRL—a format that allows a third-party program to read and parse the information. EDGAR incorporates tools that enable users to take advantage of the information. See Inline XBRL to learn more.

Shareholder Meetings

Public companies, mutual funds, and ETFs that are subject to SEC proxy rules send proxy statements to their shareholders to solicit their votes at shareholder meetings. Proxy statements describe the matters to be voted on at the meeting and may include compensation and other information about the company’s or fund’s board and executive officers. The proxy statements of domestic public companies, mutual funds, and ETFs subject to SEC proxy rules can be found on EDGAR.

Preliminary proxy statement – A preliminary proxy statement subject to review by the SEC staff.

Definitive proxy statement – The final proxy statement sent to the company’s shareholders in connection with the company’s shareholder meeting.

Executive Compensation

Domestic public companies regularly disclose the compensation of their chief executive officer and other highly paid executives, and describe their executive and board compensation policies.

Definitive proxy statement – Companies subject to the proxy rules will typically provide detailed compensation disclosure, including a compensation discussion and analysis section, in their annual proxy statement.

Annual report – If the compensation disclosure isn’t found in the proxy statement or the company has not filed a proxy statement, the annual report on Form 10-K should include the disclosure.

Current report – Changes to compensation for certain executive officers requires disclosure under Item 5.02 of this report. EDGAR search results for reports on Form 8-K show the item numbers included in each report.

Insider Transactions

Corporate insiders—officers, directors, and holders of more than 10 percent of a class of the company’s registered equity securities—must regularly disclose holdings and transactions in all equity securities of that company.

Initial statement of beneficial ownership – An initial statement of holdings in the company’s equity securities.

Statement of changes in beneficial ownership – Disclosure of transactions in the company’s equity securities within two business days of the transaction.

Annual statement of beneficial ownership – Annual statement of holdings in the company’s equity securities.

Beneficial Ownership Interest

Any person or group of persons that acquires beneficial ownership of more than five percent of a class of a public company’s registered voting securities must disclose their holdings. In addition, companies regularly disclose who their significant shareholders are and institutional investment managers, such as managers of mutual funds, hedge funds, or pensions, regularly disclose their holdings.

Schedule 13D beneficial ownership report – Filed when a party acquires more than five percent of a class of a company’s registered voting securities; also used to disclose any subsequent changes to their holdings.

Schedule 13G beneficial ownership report – Filed when a party acquires more than five percent of a class of a company’s registered voting securities as a passive investment.

Definitive proxy statement – Here, companies are required to disclose the amount of equity securities beneficially owned by their directors and officers, and any person or group that beneficially owns more than five percent of any class of the company’s voting securities.

Institutional investment manager report – Institutional investment managers disclose their holdings and any changes to them on a quarterly basis.

Business Combinations

Depending on how a merger or acquisition is structured, different types of filings may be required by the companies involved in the transaction. Common form types filed in connection with a business combination include the following.

Preliminary proxy statement relating to a merger or acquisition – A preliminary proxy statement, which remains subject to review by the SEC staff, filed in connection with a merger or acquisition.

Definitive proxy statement relating to a merger or acquisition – The final proxy statement sent to the company’s shareholders in connection with a merger or acquisition, which includes a discussion of the terms of and reasons for the transaction.

Registration statement – Filed when the company is registering securities to be used as consideration in the merger or acquisition. The registration statement often incorporates any proxy statement being sent to shareholders.

Prospectuses and communications – Written disclosures and communications in connection with a business combination where securities are part of the consideration.

Tender offer statement by third party/issuer – Filed by a party that is offering to buy outstanding shares of a public company from its shareholders. Often, the disclosure document sent to shareholders is filed as an exhibit to the filing.

Tender offer solicitation/recommendation statements – A filing required to disclose the target company’s recommendation on the tender offer.

Current report – Certain information about business combinations may be disclosed in a Form 8-K filing, such as the initial signing of a merger agreement or, if an acquisition doesn’t require shareholder approval, information about the company being acquired.

Public Offerings

In order to register an offer and sale of securities to the public with the SEC, a company must file a registration statement. The first time a company publicly offers and sells its securities is known as its initial public offering. A prospectus, which often is a large part of the registration statement, is the document given to investors that discloses information about the company and the offering.

Registration statement – Filed to register the offer and sale of securities to the public often in connection with an initial public offering.

Short-form registration statement – An abbreviated registration statement available to certain already-reporting companies to register the offer and sale of securities to the public.

Prospectus – A document disclosing information about the company and the offering that typically comprises a large part of the registration statement.

SEC correspondence – The publicly released written correspondence from the SEC staff to the company during a review process, including a review of a company’s registration statement for its initial public offering.

Correspondence – Publicly released correspondence from the company and its advisers to the SEC staff typically during a review process.

Securities-based Crowdfunding

Crowdfunding is a way to raise money from small individual investments or contributions from a large number of people. Companies that offer and sell securities to the public in reliance on an exemption from registration for securities-based crowdfunding must make filings on EDGAR.

Offering statement – Disclosure by the company making a crowdfunding offering that contains information about itself and the offering.

Progress updates – Disclosure during the offering about the status of meeting the target offering amount (unless the intermediary provides updates on its online platform) and the final amount of securities sold.

Annual report – An annual report by the company that includes financial statements.

Termination of reporting – If eligible, a filing by the company terminating its obligation to file annual reports.

Regulation A Offering

Offering statement – This includes the offering circular, the document given to investors that provides important disclosures about the company and the offering.

Exit report – This details the termination or completion of an offering. Companies conducting Tier 2 offerings can instead disclose this on Form 1-K.

Ongoing Reporting for Tier 2 Companies

Annual report – An annual report by the company that includes audited financial statements and a discussion of the company’s financial results for the year.

Semiannual report – This reportincludes unaudited interim financial statements for the first six months of the company’s fiscal year and a discussion of the company’s financial results for the period.

Current report – Filed to disclose certain events including a fundamental change, bankruptcy, change in accountant, non-reliance on prior financial statements or audit report, change in control, and departure of principal officers.

Foreign Private Issuers

Some public companies that are organized or formed outside of the United States, known under federal securities laws as foreign private issuers, may file reports with the SEC on different forms than those that must be filed by U.S. public companies.

Registration statement – Foreign private issuers may elect to register a securities offering with this filing.

Annual report or registration statement – This filing includes audited financial statements of the foreign private issuer and a discussion of the company’s financial results. A check box on the cover page indicates whether the filing is for an annual report or to register a class of securities.

Report – Filed in connection with press releases, communications to security holders, and any disclosures required to be made to security holders by the laws of the company’s home country.

Mutual Funds and ETFs

Mutual funds and ETFs make some of the same or similar filings on EDGAR that public companies do. They also file some different forms, with some filed only by money market funds. Please note funds may have similar names. To help ensure you are looking at the correct fund, double check the ticker symbol on the search results page. In addition to finding these filings on EDGAR, you can typically get them from the fund’s website or your financial professional.

Form Type

Description

Registration statement (including a prospectus) – The prospectus includes information about a fund such as investment objectives/goals; a fee table; investment strategies and risks, and performance; advisers and portfolio managers; purchase and sale of fund shares; and tax information.

Summary prospectus – Summary disclosure document includes the same key information required in the beginning of the full prospectus.

Periodic update to fund prospectus – Includes periodic updates to the prospectus.

Annual/semi-annual shareholder reports – Describes how the fund has operated and includes the fund’s holdings and financial statements. The annual report also discusses market conditions and investment strategies that significantly affected the fund’s performance during its last fiscal year.

Definitive proxy statement – Proxy statement sent in connection with matters to be voted on by fund shareholders at the fund’s shareholder meeting.

Proxy voting record – Identifies specific proposals that the fund was entitled to vote on for its underlying portfolio holdings and how the fund voted on each.

Schedule of portfolio holdings in exhibit to N-PORT– Includes a list of the fund’s portfolio holdings for the first and third fiscal quarters, those not reported on Form N-CSR.

Registration statement for fund mergers – Disclosure document includes information about a fund merger or other similar transaction.

Variable Annuities

Variable Annuities make some of the same or similar filings on EDGAR that mutual funds and ETFs do. For the best results, search by the marketing name of the variable annuity contract. Please note that insurance companies and their contracts may have similar names. To help ensure you are looking at the correct variable annuity, double check the name of the contract and the name of the insurance company. In addition to finding these filings on EDGAR, you can typically get them from the insurance company’s website or your financial professional.

Form Type

Description

Registration statement (including a prospectus) – The prospectus includes information about a variable annuity such as its fees, investment options, and insurance features, like death benefits or income protection.

Periodic update to variable annuity prospectus – Includes periodic updates to the prospectus.

Exhibits

Exhibits are often required in filings and can include material agreements, organizational documents such as company bylaws, financial statements and presentations.

A list of exhibits can be found near the end of the filing in the exhibit index, and public companies are now required to include a hyperlink to each exhibit listed. An exhibit may be filed at the same time as the filing or it may have been previously filed. If it was filed with a prior version of the filing, there often is a notation indicating that the exhibit was previously filed. If it was filed with a different filing altogether, the exhibit index often notes the exhibit as being incorporated by reference. The following table illustrates a sample exhibit index.

Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 of the Company’s registration statement on Form S-1 filed January 2, 2012) – This exhibit can be found in the prior filing referenced.

Amended and Restated Bylaws* – As indicated by the notation, this exhibit was filed in an earlier filed version of the current filing.

Loan Agreement between the Company and Big Bank, dated January 30, 2018 – This exhibit was filed with the current filing.

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About EDGAR

What is EDGAR?

EDGAR, the Electronic Data Gathering, Analysis, and Retrieval system, is the primary system for companies and others submitting documents under the Securities Act of 1933, the Securities Exchange Act of 1934, the Trust Indenture Act of 1939, and the Investment Company Act of 1940.

Containing millions of company and individual filings, EDGAR benefits investors, corporations, and the U.S. economy overall by increasing the efficiency, transparency, and fairness of the securities markets. The system processes about 3,000 filings per day, serves up 3,000 terabytes of data to the public annually, and accommodates 40,000 new filers per year on average.

EDGAR® and EDGARLink® are registered trademarks of the SEC.

Who has access to EDGAR’s information?

Access to EDGAR’s public database is free—allowing you to research, for example, a public company’s financial information and operations by reviewing the filings the company makes with the SEC. You can also research information provided by mutual funds (including money market funds), exchange-traded funds (ETFs), variable annuities, and individuals.

The Office of Investor Education and Advocacy has created a helpful guide to Using EDGAR to Research Investments.

What resources are available to help you file in EDGAR?

EDGAR provides a wealth of resources to help filers, including:

Who administers EDGAR?

The EDGAR Business Office (EBO) is the business owner of EDGAR. The office’s responsibilities include:

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SEC Filings: Forms You Need To Know

The Securities and Exchange Commission (SEC) requires public companies, certain company insiders, and broker-dealers to file periodic financial statements and other disclosures. Finance professionals and investors rely on SEC filings to make informed decisions when evaluating whether to invest in a company. SEC filings can be accessed for free at EDGAR, the commission’s online database.

The SEC was created through the Securities Exchange Act of 1934, which was signed into law by President Franklin D. Roosevelt.   The act was intended to help restore investor confidence following the stock market crash of 1929. The SEC is an independent government agency tasked with protecting investors, maintaining a fair and orderly market, and facilitating capital formation. 

The SEC selectively reviews the information it receives to monitor and enhance compliance.   Investors study these filings to form a view of a company’s performance and activities. Here are some of the most common forms that companies are required to submit to the SEC. Understanding how to read SEC filings can be beneficial to investors as they perform their due diligence. In this article, we’ll discuss these filings in greater detail.

Key Takeaways

Registration Statements

Registration statements provide information about the securities being offered by a company as well as its financial condition. A company preparing to offer securities to the public will file a Form S-1 registration statement with the SEC. The statement consists of two parts: 

Why Registration Statements Are Important to Investors

Registration statements help investors and analysts understand the nature of newly issued shares or bonds that will come to market. The type of information conveyed in these filings includes a description of the issuer’s business and assets, a description of the security being offered, the names and bios of the company’s key management, and an independently certified copy of the issuer’s latest financial statements.

Investors look especially to the prospectus, which contains all of the information a potential investor would need to make a quantitative evaluation of a new security’s prospects. It will also often contain important qualitative information that can be interpreted by investors as potential red flags. Because the prospectus is a legal declaration and must meet transparency standards, most companies include certain facts and statements to ensure investors aren’t misled in any way, although they may choose careful or clever wording to disguise overt red flags. For instance, if the company faces substantial risks, its prospectus might state «risks for the company include, but are not limited to, an evolving and unpredictable business model and the management of growth» or, «there can be no assurance that the company will be successful in addressing its risks; failure to do so could have a material adverse effect on the company’s business, prospects, financial condition and results of operations.»

Reading an issuer’s registration statements will often be met with flowery legal prose and lengthy cautionary statements that serve to protect the company more than the investor. Yet, it is also the legal nature of these documents that provides investors with candid information about a prospective investment’s risks, opportunities, and competitive landscape. When reading a prospectus, make particular note of company-specific or unique information as opposed to broad or blanket statements that could apply to any publicly traded company.

Forward-looking statements in the prospectus are only projections. Therefore, while they use a company’s honest and latest estimates, there is no guarantee the company will meet all or even any of its targets for sales and profits.

Form 10-K

Form 10-K is an annual report that provides a comprehensive analysis of the company’s financial condition. Though the Form 10-K contains information that overlaps with the company’s annual report, the two documents are not the same. Companies must submit this lengthy annual filing within 60 to 90 days of the close of their fiscal year. 

The Form 10-K is comprised of several parts. These include:

Why Form 10-K Is Important to Investors

The SEC mandates that all public companies file regular 10-Ks to keep investors aware of a company’s financial condition and to allow them to have enough information before they buy or sell securities issued by that company. The 10-K can appear overly complex at first glance, complete with tables full of data and figures. However, it is because it is so comprehensive that this filing is key for investors to get a handle on a company’s financial position and prospects.

A company will file both an annual report and a 10-K report with the SEC. The annual report is a shorter version that often comes with illustrations, glossy pages, a letter from the chair or CEO, and a summary overview of the financials. The 10-K is a longer, more thorough technical document that will have all of the company’s financial statements available for fundamental analysis. Fundamental analysis is a common way to evaluate a firm by constructing ratios and other metrics by extracting information from the balance sheet, income statement, and statement of cash flows. For stocks, fundamental analysis looks to revenues, earnings, future growth, return on equity (ROE), profit margins, and equity multiples to determine a company’s underlying value and potential for future growth. For corporate bonds, liquidity, leverage, and solvency ratios would be appropriate.

In addition to the quantitative approach to fundamental analysis, readers of a 10-K should also pay attention to its «Item 1», which explains what the company does, who its customers are, and the primary industry in which it operates. Then, look for risk factors such as legal proceedings or statements indicating future charges or volatility.

Also, pay attention to any footnotes that are included in the report. These notes will tell you which accounting method a company uses and how it compares to the generally accepted accounting method and industry standards. This information can flag potentially shady accounting practices. Other details mentioned in the footnotes include errors in previous accounting statements, looming legal cases in which the company is involved, and details of any synthetic leases. These disclosures found in the footnotes are of the utmost importance to investors with an interest in the company’s operations.

Read the Footnotes

As an investor, pay special attention to any footnotes in Form 10-K, as they can help you flag any questionable accounting practices in the company you are considering.

Form 10-Q

Form 10-Q is a truncated version of Form 10-K that is filed quarterly. The form provides a view of the company’s ongoing financial condition throughout the year. The Form 10-Q must be filed for the first three quarters of the company’s fiscal year. The deadline to file is within 40 days from the end of the quarter. Unlike Form 10-K, the financial statements in Form 10-Q are unaudited, and the information required is less detailed. 

Why Form 10-Q Is Important to Investors

The 10-Q is important since it is updated quarterly, while the more comprehensive 10-K is only filed once a year. This allows investors to update their valuation metrics and financial ratios without as much of a lag. Investors can use the 10-Q to observe any changes that may be taking place within the corporation even before it files its annual report.

Some areas of interest to investors that are commonly visible in the 10-Q include changes to working capital and/or accounts receivables, factors affecting a company’s inventory, share buybacks, and even any legal risks that a company faces. You can use a close competitor’s 10-Q as a comparison company to put side-by-side the company you are considering to see how it’s performing on a relative basis. This will give you a broader idea of whether your investment is a strong choice, where its weaknesses are, and how it could stand to improve.

Form 8-K

The Form 8-K is what a company uses to disclose major developments that occur between filings of the Form 10-K or Form 10-Q. Major company events that would necessitate the filing of a Form 8-K include bankruptcies or receiverships, material impairments, completion of acquisition or disposition of assets, or departures or appointments of executives. 

Why Form 8-K Is Important to Investors

Form 8-K provides investors with timely notification of significant changes at a company. Many of these changes are defined explicitly by the SEC (such as a merger or acquisition), while others are simply events that firms consider to be sufficiently noteworthy for its shareholders (such as a new product release or upgrade). Either way, the 8-K provides a way for firms to communicate directly with investors in a way that is not filtered or altered by media organizations or sell-side analysts.

Form 8-K also provides a valuable record for financial research and analysis. For example, an analyst may wonder what influence certain corporate events have on stock prices. It is possible to estimate the impact of these events using statistical techniques like regressions, but researchers need reliable data. Because 8-K disclosures are legally standardized and must be honest and accurate, they provide a complete record and prevent sample selection bias.

Proxy Statement

In the proxy statement, investors can view the salaries of the management of a company and any other perks that a company’s management is eligible for. The proxy statement is presented prior to the shareholder meeting and must be filed with the SEC before soliciting a shareholder vote on the election of directors and approval of other corporate actions. 

Why a Proxy Statement is Important to Investors

Public companies hold annual meetings where shareholders convene to vote on various corporate actions or for new members to the board of directors. Owning common stock in a company gives you a vote (usually one vote per share), but it is not typically feasible to attend the annual meeting. The proxy statement allows you to cast your votes using a designated person, who will aggregate votes and cast them on your behalf. This person is known as a proxy and will cast a proxy vote in line with the shareholder’s directions as written on their proxy card. Proxy votes may be cast by mail, phone, or online before the cutoff time. This deadline is usually 24 hours before the shareholder meeting commences. Vote responses will typically include «For,» «Against,» «Abstain,» or «Not Voted.»

The proxy statement will therefore present the items that will be voted on and allow you to return a form to the company to inform your proxy how your votes should be cast.

Forms 3, 4, and 5

Corporate insiders must file Forms 3, 4, and 5. The SEC defines a corporate insider as «a company’s officers and directors, and 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.» These forms are meant to reveal more information about the securities that company insiders own. 

Why Forms 3, 4, and 5 Are Important to Investors

If you’re an investor, it pays to know what the company’s owners and most important shareholders (i.e., insiders) are doing. By watching the trading activity of corporate insiders and large institutional investors, it’s easier to get a sense of a stock’s prospects. While insider or institutional ownership on its own is not necessarily a buy or sell signal, it certainly offers a handy first screen in the search for a good investment. Since insider ownership and trading can impact share prices, Forms 3, 4, and 5 are useful disclosures

By paying close attention to what insiders do with their company shares, savvy investors can make the reasonable assumption they know a lot more about their company’s prospects than the rest of us outsiders. So, if insiders are buying shares in their own companies, they might know something that normal investors do not. The insider might buy because they see great potential, the possibility for merger or acquisition in the future, or simply because they think their stock is undervalued.

One of the greatest investors of all time, Peter Lynch, once said, «insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.» Note that insiders are usually prevented from buying and selling their company stock within a six-month period following a corporate event or new issue; therefore, insiders tend to buy stocks when they feel the company will perform well over the long-term.

You can also have too much insider ownership. When insiders gain corporate control, management may not feel responsible to shareholders and instead try to enrich only themselves.

Schedule 13D

The Schedule 13D is also known as the «beneficial ownership report» and is required when any owner acquires 5% or more of the voting shares in a company. The report must be filed within 10 days of reaching the 5% threshold. It provides the following information:

Why Schedule 13D is Important to Investors

Section 13D was added to the Securities Exchange Act of 1934 as part of a 1968 amendment known as the Williams Act. This addition responded to the increasing use of tender offers as part of corporate takeovers. Schedule 13D was designed to give individual investors warning of impending changes to corporate control that could impact the future of the company, which would result from the consolidation of voting power by corporate raiders.

Investors use Schedule 13D to both detect red flags in the consolidation of insider ownership that can be potentially harmful to individual shareholders, but also as a possible harbinger of a company being acquired or bought out, which could benefit shareholders.

Form 144

Why Form 144 Is Important to Investors

While investors can look to Forms 3, 4, and 5 for changes in insider ownership, Form 144 is useful for knowing how many potential shares will be offered for sale on the open market after the lock-up period for a new issue, such as an IPO, expires. Form 144 can indicate how much a stock price might suffer if a flood of new sale orders enter the market when the lock-up ends.

Underwriters and regulators require that a company’s executives, managers, employees, and early investors (such as venture capitalists) sign lock-up agreements surrounding a company’s initial public offering (IPO) to encourage an element of stability in the stock’s price in the first few months of trading. The lock-up agreement is a legally binding contract between company underwriters and insiders that prohibits insiders from selling any shares of stock for a specified period of time. Lock-up periods typically last 180 days but can on occasion last for as little as 120 days or as long as 365 days.

Foreign Investment Disclosures

In 2008, the SEC updated disclosure requirements for foreign companies offering securities in the U.S. market. For foreign companies without SEC-registered securities, the rules eliminated the requirement that they submit paper disclosures to the SEC, in favor of allowing them to post disclosures in English on the internet. In addition, the deadline for foreign companies to submit annual reports was shortened from six months to four months. 

Why Foreign Investment Disclosures Are Important to Investors

Many investors today seek to diversify their portfolios geographically by including holdings of securities issued by non-U.S. companies. These can include shares or bonds issued by companies in the developed world to emerging market economies. Shares of foreign companies can be acquired on U.S. exchanges in the form of American Depositary Receipts, or ADRs. ADRs offer U.S. investors a way to purchase stock in overseas companies that would not be available otherwise. Foreign firms also benefit, as ADRs enable them to attract American investors and capital without the hassle and expense of listing on U.S. stock exchanges.

Foreign issuers must file forms with the SEC in a similar fashion to domestic companies to provide investors with accurate and up-to-date information. Form F-6, for instance, is a regulatory document that all investment firms must register with the SEC if they wish to offer ADRs, while Form F-4 supports the registration of securities involving foreign private issuers in connection with exchange offers and business combinations.

SEC Filings FAQs

What Are SEC Filings?

SEC Filings are regulatory documents that companies and issuers of securities must submit to the Securities and Exchange Commission (SEC) on a regular basis. The purpose is to provide transparency and information to investors, analysts, and regulators.

How Do I Look Up SEC Filings?

SEC forms are filed through a system known as EDGAR (Electronic Data Gathering, Analysis, and Retrieval system).   EDGAR performs automated collection, validation, indexing, acceptance, and forwarding of submissions by companies and others required by law to file forms with the SEC. Information on EDGAR can be found on the SEC’s website, where you can search through forms as well as familiarize yourself with the system using its EDGAR tutorial. 

You may also be able to find SEC filings using your online brokerage platform or a financial portal such as Google Finance.

How Do I Print out SEC Filings?

Filings pulled from EDGAR can be printed directly from your web browser.

Are SEC Filings Public Information?

Yes, SEC filings are public information and can be retrieved for free via the EDGAR system online. Companies may also host their own copies on their corporate websites and would be available from their investor relations department.

Note that in special circumstances, a company may request that certain information be redacted from their otherwise public filings. A confidential treatment application or confidential treatment request (CTR) is a form filled out in accordance with a company’s SEC Forms 8-K, 10-Q, or 10-K report. It allows for information in the SEC filing to be kept secret or redacted on public documents, if leaking such information could cause material or financial harm to the company or a business partner.

The Bottom Line

SEC filings provide transparency and crucial information for individual and institutional investors, for analysts & researchers, and for regulators. Ultimately, the SEC wants the public to know the facts so they can make well-informed decisions about when to buy, sell, or hold a company’s securities. Obtaining the available material and interpreting it correctly can provide any investor with valuable guidance when making investment decisions.

Understanding the information submitted by companies through SEC filings involves reading between the lines. Review several SEC documents together to better understand the overall picture, especially with financial forms, and read them in a way that maximizes efficiency. Financial ratios are often used to identify a company’s short- and long-term financial strength. Red flags are often revealed in a company’s footnotes. Red flags include a very confusing section(s) in a 10-K or 10-Q, sudden one-time or special charges, or a large degree of insider selling.

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