On The Idea Of Onlr “One” reason insiders buy … "For those new to watching here remember Insiders buy on the one market for one reason, they think its going up Insiders know! “Jopatchie
Always be careful of simplifications, and dichotomous answers that suggest only “one” reason, especially if used by a promoter supporting a stock imo.
Insiders can also buy stock, loan money, buy debentures to support the operations of acompany especially if the working capital is almost gone, and without any cash the company won’t survive(and the insiders capital is at risk as well as other shareholders).
Insolvency and bankruptcy are not wanted by anyone, and insider loans are welcomed and needed especially if outside investors haven't bought the offering-as in here. Hence the extension in financing 2x.
As noted on the Avalon accounting site:
“Sometimes, a shareholder will deposit a portion of his own money into the business to cover operational expenses. This is defined as an owner contribution, which creates a shareholder loan account. The shareholder has loaned funds to the company, and the business must repay the shareholder back at some point. This is an example of a “due to shareholder” transaction. It’s not uncommon to see “due to shareholder” balances when a company is still young, as the owner often funds the company until it can pay its expenses. It Is reflected as a liability item with a “credit” balance on the company balance sheet.”
Shareholder Loan: Understand it and Avoid Trouble with the CRA | Avalon Accounting
All imo
FWIW
Don’t invest or sell based on what you read here
it's for education-mostly mine-always learning and pleased to discuss stocks