There's a big difference between Ford and FORD.
One is a 116-year-old automaker that's worth about $36 billion. The other is a Florida company that makes medical monitoring systems and has a market cap of just $10 million.
But careless investors can confuse the two entities because "FORD" is the NASDAQ ticker symbol for Forward Industries. Ford Motor Co. shares trade on the New York Stock Exchange under a single letter: "F."
"Just about every time Ford Motor makes big news, some investors mistakenly buy shares of Forward Industries," CNN reported last week, citing research by two Rutgers University professors.
"Most investors don't reverse the incorrect trade until a week or more," said Andrei Nikiforov, an assistant professor of finance. "That's how long it takes for the stock price to return to normal, probably once investors realize they made a mistake."
The professors calculated that ticker-symbol confusion costs investors more than $1 million a year in transaction costs. Other examples they cited include oil services company Helmerich & Payne (HP) vs. tech company Hewlett-Packard (HPQ) and toolmaker Snap-on (SNA) vs. Snapchat parent Snap (SNAP).
The bad news for any would-be auto investors who accidentally bought FORD shares is that Ford Motor's stock, as much as it has struggled in recent years, is up about 14 percent so far in 2019, vs. a 19 percent decline for Forward Industries.