We'll assume you're an expert on the U.S. Constitution and, by extension, the Bill of Rights and the other amendments...you know, the first amendment (freedom of press, religion, etc.), the fifth amendment (don't talk to the police) and, of course, the twenty-third amendment (we don't have to explain that one, do we?).
The same idea behind Constitutional amendments applies to amendments in the financial world. A contract exists (like the Constitution). The parties want to change the contract ("hey, it looks like you guys forgot to guarantee free speech...let's fix that before we really get going on this government thing"). So amendments are added to the contract to enact the changes.
In business, companies can amend contracts to update information and alter terms. New prices, an updated end date, altered delivery expectations, even things like changed addresses can get worked into the original contract through amendments.
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Finance: What is Material Information?8 Views
Finance allah shmoop What is material information Well let's See
here it's A hundred percent leather won't last long in
the rain was sewn together in a taiwanese sweatshop Got
some nylon woven in okay different kind of material but
same idea With clothing material You can feel it It's
riel It itches It's Kind of you know smells but
it matters Well material information means that the information matters
particularly as it relates to a securities transaction It's material
got it All right so let's start with what's in
material You and your buddies all just bought a bunch
of coca cola stock and you're rooting for it to
go up Obviously one of the guys notes the massive
volume in gatorade owned by coke leaving the shelves of
safeway on this hundred twelve degree day Woot woot woot
The guy swears coke is going to one hundred bucks
a share Where this guy the ceo or a board
member or some other coke inside or well maybe this
would be material but he's a plumber So he knows
a lot about where coat goes You know after not
material information plumber rooting for the coke to go out
No not material material All right well we'll put you
in the center hub of where Almost all insider information
that his material trades hands the citadel the pantheon the
temple its stall number three men's bathroom number four and
you're going Yeah Number two the phone rings in the
stall next to you The bathroom is quiet and you
know echoey away All tiled bathrooms are and because the
volume is loud on the phone while you can hear
the voice on the other end she says okay so
we're going to print a dollar eighty two a share
this quarter That's the final number Even though the street
has us at only a buck forty and you recognize
her voice and i squeaky one you can't miss it
right As the famous cfo of the company you also
know that if wall street expects a dollar forty and
earnings and the company prints a dollar eighty on that
stock is going up Ah lot The information you just
heard on the phone is insider material Information Yes material
It means you and your covered parties like your wife
your kids who live under your roof and even your
dog with her own brokerage account None of them can
trade in the stock until after the earnings release because
you have material inside information that if you traded on
it it would not be fair to everyone else who
didn't have that inside Information Got it And if you
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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