Decode the Filing · Reference

Form 4 transaction codes explained

A quick-reference desk for the letters that separate a purchase from a grant, exercise, withholding event, gift, or sale.

By Buteon Research10 min readPublished July 15, 2026Last reviewed July 21, 2026

Code definitions checked against Instruction 8 of the current SEC Form 4. Source verification remains a human editorial responsibility.

Reference method

Read the code and direction together

Form 4 uses a code in Table I, Column 3 and Table II, Column 4 to describe each transaction. Instruction 8 (opens in a new tab) says to choose the code that most appropriately describes the event. If none fits, the filer uses code J and explains the transaction.

A separate A/D field says whether securities were acquired or disposed of. That field is not a synonym for buy or sell. A grant can be an acquisition. Tax withholding can be a disposition. An exercise can dispose of a derivative while acquiring underlying shares.

Instruction 8

Form 4 transaction-code quick reference

Codes from the current SEC Form 4 General Instructions, translated into a reader’s first-pass description
Code	Group	Character of transaction	First reading caution
P	General	Open-market or private purchase	A purchase, but still check price, size, ownership, plan status, and footnotes.
S	General	Open-market or private sale	A sale; the code alone does not disclose motive.
V	General	Voluntarily reported earlier than required	A timing indicator used with the transaction’s substantive code.
A	Rule 16b-3	Grant, award, or other acquisition under Rule 16b-3(d)	Issuer equity compensation or another covered acquisition, not code-P buying.
D	Rule 16b-3	Disposition to the issuer under Rule 16b-3(e)	A transfer back to the issuer, not necessarily an open-market sale.
F	Rule 16b-3	Delivery or withholding of securities for exercise price or tax liability	Often mechanical share withholding tied to receipt, exercise, or vesting.
I	Rule 16b-3	Discretionary transaction in an employee benefit plan	A plan transaction; direction and footnotes still matter.
M	Rule 16b-3	Exercise or conversion of a derivative security	An option or similar derivative became underlying securities; not a code-P purchase.
C	Derivative	Conversion of a derivative security	Read Table II and the underlying-security row together.
E	Derivative	Expiration of a short derivative position	An expiration event, not a market purchase or sale.
H	Derivative	Expiration or cancellation of a long derivative position with value received	A derivative lifecycle event; inspect value and footnotes.
O	Derivative	Exercise of an out-of-the-money derivative	An exercise classification defined by the official instructions.
X	Derivative	Exercise of an in-the-money or at-the-money derivative	Another exercise classification; not code-P buying.
G	Other exempt	Bona fide gift	A gift. A/D direction and footnotes show which side of the transfer is reported.
L	Other exempt	Small acquisition under Rule 16a-6	A specific small-acquisition category, not interchangeable with P.
W	Other exempt	Acquisition or disposition by will or laws of descent and distribution	An inheritance-related transfer.
Z	Other exempt	Deposit into or withdrawal from a voting trust	A change in holding structure.
J	Other	Other acquisition or disposition	The footnote is essential because the code is deliberately general.
K	Other	Equity swap or similar instrument	Used with the code that best describes the transaction, such as P/K or S/K.
U	Other	Disposition in a tender of shares in a change-of-control transaction	A transaction tied to a change-of-control process.

This table is a reading aid, not a substitute for the official instructions (opens in a new tab). Code details can depend on the rule cited, the table used, and the explanation attached to the filing.

General codes

P and S: purchases and sales

Code P — open-market or private purchase

Acquired / disposed context: Normally reported as acquired; confirm the A marker, amount, price, ownership form, and post-transaction holdings.
What it is: A purchase of a non-derivative or derivative security in the open market or through a private transaction.
What it is not: Proof that the price was attractive, the amount was material to the buyer, or the event predicts a return.
Common misread: Treating every acquired row—especially code A or M—as though it were a code-P purchase.

Open the focused decoder page for code P.

Compare a real code-P event in the Under Armour Case File.

Code S — open-market or private sale

Acquired / disposed context: Normally reported as disposed; check the amount sold, execution price, holdings after, footnotes, and any plan indication.
What it is: A sale of a non-derivative or derivative security in the open market or through a private transaction.
What it is not: A statement of motive. It is also distinct from code-D issuer dispositions and code-F withholding.
Common misread: Reading a code-S sale as automatically bearish, or labeling any disposed row as code-S market selling.

Open the focused decoder page for code S.

Use the buying-versus-selling framework after the mechanics are correct; the AMD Case File shows why plan context matters.

P and S are the general purchase and sale codes. Their direction is clear; their motive, materiality, and significance are not supplied by the letter alone.

Frequently misread

A, M, and F are not open-market purchases

Code A — grant, award, or other covered acquisition

Acquired / disposed context: Usually acquired, but the issuer award and its footnotes—not direction alone—identify the event.
What it is: A grant, award, or other acquisition under Rule 16b-3(d), often connected to equity compensation.
What it is not: A code-P open-market purchase or evidence that the reporting person chose to buy at the market price.
Common misread: Calling a zero-price award insider buying because the acquired-share count increased.

Open the focused decoder page for code A.

The Under Armour Case File contrasts code-P purchases with same-week code-A compensation filings.

Code M — exercise or conversion of a derivative security

Acquired / disposed context: The derivative is disposed in Table II while underlying shares can be acquired or shown as holdings in Table I. Read both tables.
What it is: An exercise or conversion of a derivative security exempt under Rule 16b-3.
What it is not: A code-P purchase at the current market price, even when common-stock ownership rises.
Common misread: Reporting gross underlying shares as a new market purchase while ignoring the option terms and related F or S rows.

Open the focused decoder page for code M.

Read Option Exercise vs. Open-Market Purchase for the full comparison and worked Tesla filing.

Code F — exercise-price or tax-liability settlement

Acquired / disposed context: Reported as disposed when securities are delivered or withheld by the issuer. Look for a footnote or other filing context; code F alone does not distinguish the obligation being settled.
What it is: Payment of an exercise price or tax liability through delivery or withholding incident to receipt, exercise, or vesting.
What it is not: A code-S open-market sale, and not automatically tax withholding in every filing.
Common misread: Treating a priced disposition as market selling without reading whether the issuer withheld shares for an exercise price or tax.

Open the focused decoder page for code F.

The Tesla Case File shows code F used for net settlement of the exercise price, with no open-market sale.

A, M, and F can appear in one compensation or exercise sequence. Preserve each row’s character before deciding whether the complete event contains any market-facing trade.

Transfers and exceptions

G, J, and the codes that demand footnotes

Code G — bona fide gift

Acquired / disposed context: Can be acquired or disposed depending on which side of the transfer is reported; read ownership and recipient footnotes.
What it is: A bona fide gift reported under the Section 16 framework.
What it is not: A market sale merely because the reporting person’s row is marked disposed.
Common misread: Turning the word disposed into sold while ignoring code G and the absence of sale consideration.

Open the focused decoder page for code G.

The NVIDIA Case File follows a 400,000-share code-G gift through its filing footnotes.

Code J — other acquisition or disposition

Acquired / disposed context: May be acquired or disposed. The marker supplies direction; the required explanation supplies the transaction’s character.
What it is: The official fallback when no listed transaction code specifically describes the event.
What it is not: Permission to assume the event was an ordinary purchase, sale, or immaterial transfer.
Common misread: Treating J as unknowable and skipping the explanation of responses.

Open the focused decoder page for code J.

The Form 4 anatomy guide explains why footnotes and both tables are part of the evidence.

Codes K, U, W, and Z likewise point to specialized structures—equity swaps, change-of-control tenders, inheritance, or voting trusts—that should not be forced into a purchase-versus-sale headline.

Code V is different: it signals that a transaction was voluntarily reported earlier than required and accompanies the substantive transaction description. It is not a directional event on its own.

Worked examples

Four hypothetical row patterns

The examples below are invented solely to explain form mechanics.

Hypothetical 1 · Grant

10,000 shares acquired, code A, price $0

First read: an issuer grant or award, not an open-market purchase. Check vesting and compensation footnotes before saying more.

Hypothetical 2 · Exercise and sale

20,000 options disposed, code M; 20,000 shares acquired; 15,000 shares sold, code S

First read: an exercise followed by a partial sale. The person retained 5,000 of the new shares before considering other withholding or holdings rows. “Bought 20,000” would misstate the event.

Hypothetical 3 · Tax withholding

3,200 shares disposed, code F, beside a vesting event

First read: shares were delivered or withheld for an exercise price or tax liability. Do not label it an open-market sale without contrary evidence in the filing.

Hypothetical 4 · Gift

5,000 shares disposed, code G, no sale price

First read: a bona fide gift. Read the footnote for the recipient or vehicle; do not infer a bearish sale.

Quality control

Common headline mistakes

“Insider bought shares” from code A. An acquisition is not always a purchase.
“Insider sold” from code F. Withholding is a disposition, but not code-S market selling.
“Insider increased ownership” after code M. The person may have sold most or all underlying shares in related rows.
“Large purchase” from total holdings. Column 5 is post-transaction ownership, not transaction amount.
“No price means free conviction.” Grants, gifts, and derivative events often require a different economic reading.
“J means unknown, so assume ordinary.” J means read the explanation.

For a complete pass through fields and tables, pair this page with SEC Form 4 Explained.

Questions readers ask

Form 4 transaction-code questions

Is code F always an insider sale?

No. Code F records securities delivered or withheld for an exercise price or tax liability incident to receipt, exercise, or vesting. It is a disposition, but it is not code-S market selling. Look for a footnote or other filing context; if neither distinguishes it, code F alone does not identify which obligation applied.

Is code M the same as insider buying?

No. Code M identifies an exercise or conversion of a derivative security under Rule 16b-3. Code P identifies an open-market or private purchase. Read any related F or S rows before describing the complete exercise event.

Does code G mean the insider sold shares?

No. Code G means a bona fide gift. A disposed marker can show the reporting person’s side of that transfer, but it does not turn the gift into a market sale.

Can several rows belong to one event?

Yes. An exercise can span a derivative row, underlying-share row, issuer-withholding row, and a separate sale. Match dates, security types, codes, and footnotes before summarizing it.

Which code identifies an open-market purchase?

Code P identifies an open-market or private purchase. It still does not establish motive, materiality, or future performance; those questions require context beyond the code.

Buteon’s method

How Buteon reads transaction codes

Buteon treats codes as typed evidence, not as decorative labels. It preserves the difference among market transactions, issuer compensation, derivative mechanics, withholding, gifts, and specialized transfers. Related rows can then be joined into one event without erasing their individual provenance.

That mechanical precision comes before signal interpretation. If the event is routine, the useful conclusion may be that no conviction-bearing purchase or sale occurred at all.

Source desk

Primary sources

These links support the filing mechanics and regulatory details in this guide. SEC rules can change; use the source itself when a precise legal question matters.

Primary sourceSEC — Form 4 and General Instructions (PDF) (opens in a new tab)
Current blank form and official instructions, including tables, ownership fields, transaction codes, amendments, and Rule 10b5-1 indication.
Primary sourceSEC — Insider Transactions and Forms 3, 4, and 5 (PDF) (opens in a new tab)
Official two-page reference for the three forms and frequently seen transaction codes.
Primary sourceInvestor.gov — Insider Transactions and Forms 3, 4, and 5 (opens in a new tab)
SEC investor bulletin covering reporting persons, filing timing, common codes, and the relationship among Forms 3, 4, and 5.

Concept ↔ Case File

Move from the reading method to the public document without losing the line between fact, interpretation, and hindsight.

TSLA

Elon Musk's Tesla Option Exercise: What the Form 4 Showed

Code M recorded the option exercise; code F recorded issuer withholding for the exercise-price settlement. The filing reported no open-market trade.

Read the related Case File

NVDA

NVIDIA’s Jensen Huang and a 400,000-Share Transaction: Why the Code Matters

“Disposed” does not automatically mean “sold.” Transaction code G identified a gift, not a market sale.