Mistaken identity is usually harmless enough. Like when you download the wrong Wordle app, or mistake skateboard OG Tony Hawk for, well, himself. 🛹 But don’t let it trip you up when it comes to investing.
Last week investors rushed to sell shares in Alibaba (BABA), the ecommerce giant co-founded by Jack Ma, after reports that a man named ‘Ma’ had been arrested in China for alleged national security violations. More than US$26 billion was wiped off the share price before it was clarified that it was not, in fact, Jack Ma. Alibaba shares subsequently bounced back…but it could have been a costly case of mistaken identity for some investors. 🥵
It might sound silly, but with thousands of companies hovering in the investing universe it can happen surprisingly easily. When shares in Zoom Video Communications (ZM) started to take flight during the pandemic, another ‘Zoom’ took off too. Shares in Zoom Technologies, using the ticker symbol ‘ZOOM’ zoomed more than 800% in the first three months of 2020 before the US Securities and Exchange (SEC) ordered it into a trading halt. Confused? So were investors! 😬
Elon Musk triggered another case of mistaken identity when his tweet ‘Use Signal’, referring to a non-profit, encrypted messaging app, caused some investors to plough money into an unrelated listed company Signal Advance, pushing their shares up almost 12,000%!
And of course then there is The Coca-Cola Company. 🥤 The Coca-Cola Company uses the ticker symbol ‘KO’ and is responsible for marketing, production of concentrate syrups and keeping the lid on Coke’s ‘secret formula’. To get this goodness into bottles, the company employs around 225 bottling partners worldwide, one of which is Coca-Cola Bottling Consolidated, which goes by the ticker ‘Coke’. After a long day of Wordle and skateboarding it’d be easy to get the two mixed up. 🤪 Invest wisely out there folks. Avoid ‘fat finger trades’, look before you leap and school up on your investing smarts!