Price-Sensitive Information
Information about a company that, if published, would be likely to materially affect its share price.
How it is identified
Test: a reasonable investor would consider the information relevant to a decision to buy, hold or sell the security
Unit
qualitative
In depth
Unpublished price-sensitive information is the trigger for insider trading restrictions, and the regulations list examples including financial results, dividends, changes in capital structure, mergers, and changes in key personnel. The test is prospective and judgemental — would it likely affect the price — which is why companies maintain a policy and a database of who holds such information. Once published to the exchanges and after a stated period, the information ceases to be unpublished and trading restrictions lift. The word likely does substantial work here, since certainty is not required.
Worked example
A board deciding to recommend a dividend creates price-sensitive information at the moment of the decision, not at the moment of the announcement. Everyone present is barred from trading in the interval.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Price-Sensitive Information” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.