Often, specific news or events can quickly affect the rise or fall of stocks. That is why it is worth following the projects that are in the portfolio or which are planned to be acquired. But it is equally important to be careful when buying because you can get into a situation like the one described below.
- The sharp rise in shares of zoom technologies
- Why did stocks of zoom technologies soar?
- Is there a single case with shares of zoom technologies or are there similar ones?
- Zoom Video Communications Inc so in demand?
The sharp rise in stock technologies zoom
Since the beginning of March, unusual activity began to be observed on the stock charts of a small Beijing company that manufactures communications equipment. Those wishing to purchase their securities arrived every day and by the 20th day, the price soared by 557%. At the peak, they traded at $ 20.9 apiece. The excitement did not last long and a sharp jump was followed by the same rapid decline. Now, these shares can again be purchased no more than at the end of February. That’s just the lion’s share of those wishing to “somewhere” was gone.
Why did stocks of zoom technologies soar?
No, the company has not made a technological breakthrough; it is not planned to be absorbed by a larger market player. Only 10 people work here, and such a leap is not their merit.
The main reason is the banal carelessness. There is a project with a similar name – Zoom Video Communication. It was he who was the desired goal of most who bought the wrong paper by mistake. The fact is that the ZOOM ticker (marking on the exchange) is assigned to the Beijing baby, and the second one is marked as ZM. This was the reason for the misunderstanding and acceleration of the price.
By the way, this case is already the second with these companies. April 18, 2019, Zoom Video Communications completed an IPO on the NASDAQ. Since the project occupied a promising demanded niche, it had existed for a long time and showed excellent results; there were enough people who wanted to buy securities so that by the end of the trading day the price per unit from $ 36 would increase by 72% ($ 62).
As you might have guessed, Zoom Technologies quotes also went uphill, and earlier. On March 22, the first information about the IPO Zoom Video appeared. A day earlier, they were worth $ 0.005, and three weeks later, on April 15, they were trading at $ 5.5. The growth amounted to an incredible 47,000%! After there was a drawdown, but on the day of the IPO, the price was $ 2.7 per unit, and the company’s capitalization reached $ 8 million.
Yes, the shares were not underestimated and after a sharp rise in price, they fell in price just as quickly. But those who in time revealed the reason for the sharp rise in prices managed to make decent money on this.
Is the case with the stock technologies zoom single or are there similar ones?
Over the past 10 years, this is the fifth such case. Similarly, investors were mistaken when buying the following securities:
- Nest Labs;
- Auris Health;
- Snap Inc.
In all cases, the names were similar, which helped the projects “twins” to grow in capitalization, albeit not for long.
- October 2013. Announcement of the microblogging service on the IPO on the New York Stock Exchange. According to company representatives, it was planned to raise $ 1 billion from the initial offering, and the cost of 100% of the shares was estimated at almost 13 billion. According to the application, the company was assigned the ticker TWTR. In the wake of a frenzy of excitement, some investors began to buy shares in the Tweeter electronics chain, which went bankrupt in 2008, but its shares were still on the OTC market for $ 0.007 apiece. The ticker was also very similar – TWTRQ. Just inattentive did not take into account the fact that companies that undergo bankruptcy are often marked with a Q marker. The price of shares on October 4, 2013, rose by 1400% to 15 cents per unit, but many investors quickly realized the mistake and by the end of the day the price tag stopped at 5 cents apiece. Total – 685%.
- January 2014. Google announced that it will acquire Nest Labs for $ 3.2
billion. The promising direction of developing a system of smart homes
attracted many investors, and some of them began to acquire shares under the
NEST ticker. The situation is funnier than the first case because
the company was private and its shares could not be acquired in
principle. At that time, the Nest ticker was trading under the
- January 2019. Information on the acquisition of surgical robots manufacturer Auris Health by Johnson & Johnson Corporation appears on the network. Despite the recommendations of analysts to buy shares of J & J, some rushed to buy securities AH. As in the previous example, they did not take into account the nuance that this company also did not trade on the exchange. As a result, investors “invested” in Auris Medical Holding – a tiny manufacturer of medicines. The growth of stocks per day reached 30%, but by the end of the day stopped at 13%.
- January 30, 2017. Information on Snap INC plans to conduct an IPO appears in Bloomberg. The exact date was not indicated. Investors did not pay attention to the fact that the initial placement was only planned, and began to buy paper with the same name on the stock exchange. In just 4 days of trading, Snap Interactive shares rose almost 4 times – up to $ 15 apiece. Thanks to the media, which drew attention to the situation, by February 8, the price fell by half.
To prevent such mistakes, when investing in a portfolio, it is important not only to carefully analyze companies but also how to purchase securities.
Is Zoom video communications inc so in demand?
Services for organizing conference calls over the Internet are becoming more popular every year. This is obvious – because it gives new opportunities in many areas, starting with training and ending with the interaction of employees without physical meetings.
The advantage of ZOOM is that it can be used to hold an online conference even for free with a relatively small number of people. Plus it is perfectly adapted not only for PC but also for tablets, mobile. The main competitor and a more familiar way to call 3 or more people used to be Google Hangouts, but with its closure, attention to Zoom grew even more.
Recent months have been the most successful for Zoom Video thanks to quarantine. Hundreds of thousands of employees around the world have been transferred to remote work at home. Many of them hold mitaps using this service. The format of video conferences is already used by teachers whose students are in isolation. This whole situation helped to demonstrate how many applications this technology has and that the current capabilities of the platform are not the limit.
Undoubtedly, Zoom Video stocks will continue to grow. And this is especially pleasant to observe during the global crisis of 2020 when many large projects are going through hard times. But it is more pleasant to consider such a prospect when projects are only at the beginning of their path.
Given the fact that quarantine will last for some time and it is better to stay at home, this is a great chance not only to complete all the old things but also to begin to learn a new profession, which will make it possible to earn money from anywhere in the world even during a crisis.
Many have heard about trading, but few decide to try to succeed in this direction. Risks, fear of losing money, a bunch of irrelevant information and other similar moments stop many. Who is trying to master everything on their own?