Elon Musk, CEO of Tesla, stands on the construction site of Tesla Gigafactory. In Grünheide near Berlin, September 3, 2020
Patrick Pleul photo union Getty images
When Tesla CEO Elon Musk called on his Twitter followers to “use Signal” on Thursday, he was referring to the encrypted messaging app. Some people seem to have taken the wrong path.
Shares of a vague and unrelated company called Signal Advance, which trades at the counter, rose 527 percent on Thursday and another 91
The signal, which Musk refers to, is managed by a non-profit organization and serves as an alternative to text applications such as Facebook Messenger, WhatsApp and Apple’s messaging service. This Signal went on Twitter on Friday to clarify that it had nothing to do with Signal Advance.
“Understandably, people want to invest in Signal’s record growth, but that’s not us,” Signal wrote. “We are an independent 501c3 and our only investment is in your privacy.”
This is a known problem on Wall Street.
In April 2019, the day Zoom Video Communications made its expected market debut under the ZM symbol, a Chinese company called Zoom Technologies jumped more than 80% in two hours of trading. Shares gave up most of those gains that day, closing 10%.
Six years earlier, while investors were waiting for an IPO on Twitter, shares of Tweeter Home Entertainment Group rose more than 1,000%.
Signal Advance was founded in Texas under the name Biodyne in 1992 and provides services to medical and legal professionals. The company turned its attention to the use of technology in healthcare and changed its name to Signal Advance. Weakly traded stocks entered the market in 2014.
Signal Advance is so small that it does not report financial data to the SEC. As of March 2019, there are no full-time employees, except for CEO Chris Heimel, who did not immediately respond to a request for comment.
Due to the swarm of involuntary investor interest, the company already has a market capitalization of $ 660 million, compared to $ 55 million two days ago. Prior to Thursday, the shares had been trading below $ 1 since 2015.
The Signal messaging app, backed by the Signal Technology Foundation, “works entirely with donations,” according to an article in the New Yorker published in October.
The group had other concerns after Musk’s tweet to his more than 41 million followers. Signal said on Thursday that there were technical problems with the inspections because “so many new people are trying to join”.
Both technical speed and wild trading in unrelated stocks underscore Musk’s growing influence. On Thursday, he became the richest man in the world thanks to an almost 800% increase in market capitalization in the last year. On Friday, Tesla became the fifth most valuable public company in the United States, surpassing Facebook.
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