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Finance allah shmoop What is material information Well let's See

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here it's A hundred percent leather won't last long in

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the rain was sewn together in a taiwanese sweatshop Got

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some nylon woven in okay different kind of material but

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same idea With clothing material You can feel it It's

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riel It itches It's Kind of you know smells but

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it matters Well material information means that the information matters

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particularly as it relates to a securities transaction It's material

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got it All right so let's start with what's in

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material You and your buddies all just bought a bunch

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of coca cola stock and you're rooting for it to

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go up Obviously one of the guys notes the massive

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volume in gatorade owned by coke leaving the shelves of

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safeway on this hundred twelve degree day Woot woot woot

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The guy swears coke is going to one hundred bucks

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a share Where this guy the ceo or a board

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member or some other coke inside or well maybe this

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would be material but he's a plumber So he knows

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a lot about where coat goes You know after not

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material information plumber rooting for the coke to go out

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No not material material All right well we'll put you

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in the center hub of where Almost all insider information

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that his material trades hands the citadel the pantheon the

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temple its stall number three men's bathroom number four and

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you're going Yeah Number two the phone rings in the

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stall next to you The bathroom is quiet and you

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know echoey away All tiled bathrooms are and because the

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volume is loud on the phone while you can hear

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the voice on the other end she says okay so

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we're going to print a dollar eighty two a share

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this quarter That's the final number Even though the street

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has us at only a buck forty and you recognize

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her voice and i squeaky one you can't miss it

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right As the famous cfo of the company you also

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know that if wall street expects a dollar forty and

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earnings and the company prints a dollar eighty on that

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stock is going up Ah lot The information you just

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heard on the phone is insider material Information Yes material

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It means you and your covered parties like your wife

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your kids who live under your roof and even your

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dog with her own brokerage account None of them can

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trade in the stock until after the earnings release because

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you have material inside information that if you traded on

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it it would not be fair to everyone else who

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didn't have that inside Information Got it And if you

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aren't sensitive to material information wealth here's the material you'll 00:02:35.778 --> [endTime] end up wearing hope you look good in stripes

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