What determines whether nonpublic information is considered materially significant?

Nonpublic information is deemed materially significant primarily based on its potential impact on investment decisions. Materiality concerns any information that could influence an investor's decision to buy, sell, or hold a security. If the information is such that a reasonable investor would consider it important when making investment choices, then it is classified as material.

For instance, if a company is about to announce significant financial results, or if they are involved in a negotiation that could dramatically alter their financial performance, these situations reflect information that would be deemed materially significant due to their direct implications on the perceived value of the company's stock. This is central to ensuring fair trading practices, as all investors should have access to information that could affect their decision-making.

On the other hand, factors like the issuer's popularity, the date of the information, or the availability of similar information do not inherently determine the materiality of nonpublic information. Popularity does not equate to the significance of any hidden details about a company, credibility and timing of information are important, but they do not dictate whether the information is material in and of themselves. Similarly, the presence of similar information could diminish the uniqueness or exclusivity of the nonpublic information but fails to address its actual impact on investment behavior.