A few days ago, Pfizer CEO Albert Bourla sold $5.6 million worth of shares comprising 132,508 shares for $41.94

Some analysts, however, questioned the timing of the deal

Time for a THREAD

He sold the shares on the day the company announced its COVID-19 vaccine being developed alongside BioNTech had 90% effectiveness in protecting people from the virus. 

Here is a breakdown of what happened and why people pay attention to such trades.

In listed companies, you have a group of people with access to sensitive information.

It could be information about new products or results.

These people are known as insiders. They include senior management and board members

This set of people by law can not trade their shares before such info is released to the public.

Insider trades based on sensitive information are illegal. 

All insider trades by key staff must be reported.

The same also applies to the Nigerian Stock Exchange.

So did the Pfizer CEO do any wrong? 

The shares sold were done in line with a trading plan known as a 10b5-1 plan.

The price, amount, and sale dates must be specified in advance.

For senior executives, besides being paid a salary, they get compensated in form of shares. Which they can decide to sell or keep.

Bourla has worked for Pfizer for 25 years and has accumulated some shares. He still has about $15 million worth of shares

The ultimate decision if there was any wrongdoing will be decided by the Securities and Exchange Commission (SEC).

The SEC is the body that oversees the stock market and thus listed companies.