Form 4 Transaction Codes: How to Read S, G, M, F, and 10b5-1

Form 4 is the SEC filing that corporate officers, directors, and 10% beneficial owners use to disclose insider transactions in their company's stock. It is one of the most-read items on EDGAR — and one of the most-misread. The single biggest source of confusion is the transaction code: a one-letter field at the bottom of the filing that completely changes what the report means. A "Bezos sells $X" headline based on a code-G filing is wrong in the same way "Vanguard exits Amazon" based on a code-13G/A filing is wrong: the legal disclosure says one thing, the trading interpretation requires a second layer of context. This guide walks through the eight Form 4 codes that show up most often, how to read each correctly, and where the 10b5-1 plan footnote changes the story.

The eight codes you need to know

Every Form 4 transaction is stamped with a code that defines the transaction type. Most filings use one of these eight:

• S — Open-market sale. The insider sold shares on a public exchange. This is the only code that produces actual selling pressure on the stock without any structural caveat. Even so, see the 10b5-1 section below — many code-S transactions are pre-scheduled, not discretionary.
• P — Open-market purchase. The insider bought shares on a public exchange with their own money. Generally the cleanest bullish signal because the cash came out of pocket. Still: check whether the purchase was triggered by a 10b5-1 buy plan or a compensatory matching program before drawing conclusions.
• M — Option exercise. The insider exercised stock options at the strike price, converting options to underlying shares. M is not a market trade — it is a structural change in how the same compensation package is held. The shares received from M are sometimes immediately sold (often coded S in a paired filing) for tax purposes; the M itself does not move the market.
• F — Tax withholding at vesting. When restricted stock units (RSUs) vest, the company typically withholds a fraction of the shares to cover income-tax liability and sells those shares on the open market on the insider's behalf. Code F is the disclosure of those withheld shares. It is mechanical, not discretionary, and almost never a sentiment signal.
• A — Award / grant. The insider received shares (RSUs, options, or restricted stock) as compensation. A is not a purchase — it is the company giving stock to an employee. Coverage that frames an "A" filing as a CEO buying their own stock is misreading the document.
• G — Gift. The insider transferred shares to a recipient at no cost. Gift recipients are typically charitable foundations (Bezos Earth Fund, Day 1 Families Fund), family trusts, or estate-planning vehicles. The shares change beneficial owner without hitting the public market, so G is not a market signal — it is a charitable or estate-planning disclosure.
• C — Conversion. A security was converted from one class to another (preferred to common, convertible note to common, performance share unit to common stock). Structural, not directional.
• D — Disposition (non-market). A catch-all for non-market dispositions like share buybacks at company tender prices, escheat to states, or other administrative transfers. Almost always procedural.

The 10b5-1 plan footnote that changes everything

SEC Rule 10b5-1 lets corporate insiders adopt a written trading plan that pre-specifies how many shares will be sold or bought on what dates at what price levels. Once adopted (during an "open window" when the insider does not have material non-public information), the plan executes mechanically — the insider has no further discretion. Plan-driven transactions are still filed on Form 4 with code S or P, but the filing includes a footnote noting that the trade was executed under a plan and giving the plan adoption date.

The distinction matters because a 10b5-1 plan sale is the mechanical execution of a months-old decision. The CEO who is selling on April 22, 2026 under a plan adopted on November 15, 2025 was not reacting to anything that happened in 2026 — they were following a schedule made when the stock and the company looked different. Discretionary bearish framing — "CEO dumps stock ahead of earnings" — is wrong on a plan sale. Safe phrasing: "sold under a prearranged Rule 10b5-1 plan adopted [date]".

Two patterns flag a 10b5-1 plan even when the footnote is buried. First, fragmented multi-tranche execution: the same trading day showing 18 sub-thousand-share sales at sequential price levels is textbook algorithmic execution under a plan. Second, recurring quarterly cadence: clusters spaced roughly every 90 days are usually plan-driven; one-off concentrated sales typically are not.

The "owns zero shares" trap

Many Form 4 filings show a beneficial-ownership-after column that reads zero shares. That number almost never means the insider has fully exited. Form 4 separates Table I (non-derivative — common stock and direct holdings) from Table II (derivative — options, warrants, preferred shares). A filing that zeroes out Table I can leave a substantial Table II position untouched. Dual-class companies (Class A and Class B common stock) compound the problem: Class B shares often live in Table II reporting and never appear in the headline summary.

The safe phrasing on a Form 4 reading zero in Table I is: "no Class A common shares reported on Form 4 Table I." Never extrapolate to "owns zero shares of the company" without checking Table II and any separately reported beneficial entities (trusts, family LLCs, foundations) that might hold the bulk of the position.

A live walkthrough: Bezos's May 2026 filings

Jeff Bezos filed two Form 4s in early May 2026 — May 1 and May 4 — disclosing transfers of 1,033,597 and 220,200 AMZN shares respectively. Both filings used transaction code G. A casual scan of the EDGAR feed would surface these as "Bezos transfers $250M+ of Amazon stock" and the trading desk's first instinct would be to treat them as supply pressure. The correct read: code G means gift, not sale. The shares went to a recipient (likely the Bezos Earth Fund or Day 1 Families Fund based on the historical pattern) and never hit the public market. There is no supply pressure on AMZN from those filings.

The same lens applied to Bezos's July 2025 filings produces a very different answer: those used code S (open-market sale) at execution prices between $225 and $233. Those filings did create supply pressure. Eight months of code-G filings (August 2025, November 2025, May 2026) have followed without code-S resuming. A retail reader who can distinguish the codes can see that Bezos's last open-market selling activity was nine months ago — the recent reductions are philanthropic transfers, not "the CEO is dumping stock."

What a careful insider-transaction reader actually checks

Before drawing any conclusion from a Form 4, run this checklist:

1. What is the transaction code? S/P are market trades. M/F/A/G/C/D are not.
2. Is there a 10b5-1 plan footnote? If yes, the trade was pre-scheduled.
3. Does the filing zero out Table I? If yes, check Table II and separate trusts before claiming the insider exited.
4. Is the cadence quarterly and fragmented across many small tranches? If yes, almost certainly plan-driven.
5. Does the recent transaction history show only G filings since the last S? If yes, the recent reductions are gifts, not sales.

For ongoing Form 4 filings across the names you watch, the active institutional signal feed labels each transaction with its code and surfaces the 10b5-1 footnote when present, so the read-the-tape work is done up front. Insider profile pages (e.g., the Form 4 history for any covered executive) include a transaction-by-transaction table with codes, prices, and accession identifiers — the same primary-source data the SEC publishes on EDGAR, in a more readable format.