The share price of US start-up Snap Interactive has almost doubled in value, purportedly due to investors thinking they were buying into the firm behind Snapchat.
Last week, Snapchat’s company Snap Inc announced it’splans to raise $3bn in a stock market listing. In the time since, unrelated company Snap Interactive and reported a 95% increase in share value.
While San Francisco-based Snap Inc is estimated to be worth $25 billion, New York-based start up Snap Interactive is valued at a much lesser $54m (£43m).
Similar share-buying errors in recent years have seen several companies see a massive influx in price following announcements about better-known companies with similar names.
In 2014, news of Facebook’s $2bn deal to buy virtual reality headset maker, Oculus VR lead to an 150% increase in the price of shares in similarly-named company Oculus VisionTech.
In 2013, following the news about a share sale in Twitter, stocks in Tweeter Home Entertainment Group grew by over 500%.
Lesson learned: check the name of the company you’re buying into, before you cough up.