It is a case of mixed signals.
Puzzled traders sent the price of shares of an obscure medical device company by more than 400% in one day, after Elon Musk urged them to use a messaging app of the same name.
The bizarre rally began after billionaire chief Tesla he told his 42 million fans on Twitter to “Use the signal” on Thursday, it seems to refer to the mobile application that allows users to exchange encrypted messages.
Instead, investors bought shares in Signal Advance Inc., a small Texas-based company that makes devices used to detect various health problems.
The company’s shares traded at the counter rose to $ 3.76 on the day of Musk’s tweet from 60 cents the day before. Shares nearly doubled to $ 7.19 on Friday and then rose 438% to $ 38.70 on Monday, despite news of apparent confusion.
Signal Advance did not immediately respond to a request for comment Tuesday morning. But CEO Chris Hymel told Bloomberg News that the company “strongly recommends[s] people do their due diligence and always invest carefully. ”
Investors who want to buy shares in the Signal app are out of luck – it is owned by the Signal Foundation, a non-profit organization about three years old.
The application has experienced its own boom in recent days since rival WhatsApp launched an update of its privacy policy that allows it to share user data with Facebook, its parent company.
About 810,000 users worldwide installed Signal on Sunday, almost 18 times the number observed on January 6, the day of the WhatsApp privacy change, according to data from the research company AppTopia.
Signal warned investors that it “has absolutely nothing to do” with Signal Advance shares as the company’s share price exploded.
“It’s understandable that people want to invest in Signal’s record growth, but it’s not us,” the app said. he said on Twitter. “We are an independent 501c3 and our only investment is in your privacy.”
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