Shares of Nestor, whose ticker symbol was NEST, jumped 1,900%.Īt the time, Bloomberg noted the stock rallied “apparently because people confused Nest and NEST.”īloomberg added that the confusion was most likely caused by algorithms. In 2014, Google announced it was buying Nest. News reports indicate this is a long-standing problem. SIGL isn’t the only example of trader confusion. It’s hard to understand what buyers were thinking. There was no fundamental reason to buy SIGL in early January.Īfter multiple announcements from reliable sources noting the confusion, the stock still moved up. This stock shows just how irrational investors can be.

At that price, the company was worth more than $6 billion.Īlmost two months after the incident, SIGL is still more than 300% above its pre-Musk price. Two days later, after CNBC noted the confusion and the makers of the Signal app tweeted about the misunderstanding, SIGL peaked at $70.85. SIGL moved from $0.60 to a high of $5 on the day of Musk’s tweet. This company had about $6 million in sales in the last 12 months. It allows users to maintain privacy.īut traders assumed that he meant to say: “Use Signal Advance.” Musk was suggesting that his followers use an encrypted messaging app called Signal. On January 7, Musk tweeted: “Use Signal.”

How Elon Musk Sparked Signal Advance’s Rally In fact, the stock’s big gain was the result of a misunderstanding caused by Tesla CEO Elon Musk.

And it’s likely the investors who bought and sold the stock in January didn’t know either. And it reveals that investors are certainly not rational. However, the chart below of Signal Advance Inc. This process assumes that prices are based on fundamentals, and that investors are sensible enough to only buy stocks that are fundamentally undervalued. These models are the basis of the firms’ price estimates for a company’s stock. They send analysts to visit companies, who then build complex models estimating sales, costs and profits. Wall Street firms spend millions of dollars on research.

Signal messenger stock symbol