Legal Definitions - tip

Definition: A tip is a piece of special information that is passed from one person to another. In securities law, it refers to advance or inside information that is shared illegally.

Example: If someone tells you that a company is going to release a new product that will make their stock price go up, that is a tip. However, if that person works for the company and is not supposed to share that information, it is considered insider trading and is illegal.

Explanation: The example illustrates how a tip can be useful information, but it can also be illegal if it is insider information that is not supposed to be shared. It is important to be aware of the laws and regulations surrounding tips and insider trading to avoid any legal issues.