“Similar” Does Not Mean “Same”

Sameer : Hey Niraj, are you applying for this IPO of XYZ Ltd ?

Niraj : No Sameer. By the way, what is the business of this Company XYZ ?

Sameer : I have no idea. But I believe the stock price will increase. Lot of my friends are saying that.

Niraj : Don’t Fall prey to Herd Mentality Sameer. Many a times people mindlessly invest in stocks without knowing anything about their business and then get brutally punished for it.

Sameer : I don’t believe this. Can you give me any examples ?

Niraj : There are Several Examples.

Example 1 : When lockdown-1 started in 2020, people started using zoom meetings extensively. As a result, people blindly started buying stocks of “Zoom Technologies Inc.” whereas the company which owned Zoom Meetings software was called “Zoom Video Communications”. The Stock price of “Zoom Technologies Inc.” increased just because it had “zoom” word in its name (although this company wasn’t remotely connected to zoom meetings company). The stock price of “Zoom Technologies” fell from USD 20 to zero in no time, as soon as people realised that it is not the right company.

Example 2 : In lockdown-2, India was facing shortage of oxygen cylinders in hospitals. People blindly started buying stock of company called “Bombay Oxygen Corp Ltd” which was remotely not connected to production of oxygen cylinders. The stock price fell by 50% as soon as people came to know this.

Sameer : Oh My God !! This is So true and Shocking. But isn’t this the mistake of Companies also to keep misleading names ?

Niraj : Let us assume that this is the mistake (or ploy) by the companies to trap the investors. Still, is it not investor’s responsibility to do some basic research on the stock, before investing in it ?

Sameer : Doing in depth research is not everyone’s cup of tea, Niraj. What should a layman investor do ? They get confused between similar names and fall for it.

Niraj : Sameer, just because it looks similar or sounds similar, does not mean it’s the same. One has to go deeper before investing hard earned money. If you are not an expert in it, get professional guidance. But Don’t put your hard earned money blindly.

Sameer : You are absolutely right Niraj. We can’t afford to invest blindly and then blame others. We have to either do our homework well or get a trusted advisor.

The Author Prof. Saurabh Bajaj (BE, MBA, FRM, CFGP, AFGP) is CEO with Nidhi Investments, Mumbai. His articles have a readership from 78 Countries across the Globe. He may be contacted on CEO@nidhiinvestments.com if you have any questions.

(The views mentioned in the article are personal opinion of the author)




Published by professorbajaj

Prof. Saurabh Bajaj is an Author, Mentor, Motivational Speaker and Wealth Planner. He has done his MBA from Narsee Monjee Institute of Management Studies (NMIMS) Mumbai, one of the top 10 management institutes in India. He holds the prestigious FRM (Financial Risk Manager) degree awarded by Global Association of Risk Professionals (GARP), USA. Till date, there are less than 15,000 professionals in the world, who have been honored with this degree. He has also been awarded CFGP (Chartered Financial Goal Planner) Certification by AAFM (American Academy of Financial Management). After his MBA, he joined J P Morgan, the second largest Investment Bank in the world. He has worked with J P Morgan as Risk Analyst for more than two years. Prof. Bajaj also holds an Advisory certification awarded by AMFI (Association of Mutual Funds of India). During his stint at Bombay Stock Exchange, he has handled Investment Management and Treasury operations of the BSE Corpus. He has set up an entrepreneurship venture in the field of Wealth Planning and Investment Consulting under the name “Nidhi Investments” and holds the profile of CEO. Prof. Bajaj sits on the Expert Panel of CAClubindia.com and MBAClubindia.com as Investment Expert. He is actively involved in investor education through his blog www.professorbajaj.com which has a readership from 78 Countries all over the world. His articles are also regularly published in caclubindia.com , mbaclubindia.com , totalca.com , charteredclub.com, bankbazaar.com and lawyersclubindia.com . He has been awarded the title of “Best Article Writer” from caclubIndia.com in Jan 2012 and has been selected amongst “Top 5 Technical Writers” from all over India in Feb 2013. He has been invited by various TV Channels like SPIN TV, CNBC TV18, UTV Bloomberg Etc for programs like "Expert Advice" , "What Markets Want ", "Budget Analysis" etc. He has been invited by Several organisations like Lions Club, Rotary Club, Agrawal Welfare Foundation, Rajasthan Mandal, Agroha Vikas Trust, Union MF, UTI MF, Arthamitra Gurukulam, Vidyalankar Institute of Technology etc for expert lecture on "Smart Investing", "Life is A Celebration", "Financial Freedom", "The Digital IFA" etc. He was ranked 8th Merit at All India level NMAT which got him selected for MBA programme at NMIMS, Mumbai. He did his MBA with Capital Markets as his specialisation. Soft Skills has become an inevitable part of every selection process and teaching learning process these days. The students from small towns and tier II cities, in spite of being talented and well equipped with technical skills, are seen struggling in the selection process. This is because of their lack of exposure to these soft skills. Mr. Bajaj has a zeal for training candidates to develop these skills and has been imparting the same on since last two years. This zeal and passion inspired him to set up his own firm called “Knowledge Circle” which aims to train candidates for soft skills. Till date, he has trained more than 5000 participants from over 220 organizations across various fields of soft skills. He has been associated with MSBTE (Maharashtra State Board of Technical Education) to conduct Soft skills training workshop for the faculties of Polytechnic Colleges in Entire Maharashtra (Mumbai Region, Pune Region, Aurangabad Region and Nagpur Region) since last 8 years. He has also been associated with ICAI (Institute of Chartered Accountants of India) for training CA Students on various topics related to Communications skills, Group Discussions etc. He was invited by Fr. Agnel Polytechnic College, Vashi for a motivational workshop for faculties. He was also invited by Vivekanad Polytechnic College for "Communication Skills and Email Etiquette" training for non-teaching staff. Apart from these, he has conducted “Capacity Building Soft Skills workshop for Faculties” at ITI Gunj, ITI Pusad, ITI Digras and ITI Umarkhed. This was the first ever soft skills workshop for faculties in the history of ITI’s in Vidarbha. He was also invited by Shivaji Education Society to conduct similar Soft skills workshops for the faculties and office staff of Shivaji Junior College Pusad, Shivaji High School Pusad, Shivaji Vidyalaya Belora and Shivaji Vidyalaya Bhojla. He has conducted training workshop on “Effective Presentation Skills” for the relationship managers of HDFC Mutual Fund, Andheri Branch, Mumbai. He has also been invited at College of Management and Computer Science, Yavatmal, College of Dairy Technology, Warud, B N College of Engineering, Pusad, B D College of Engineering, Wardha, College of Engineering and Technology, Akola, Dr.N.P.Hirani Institute of Polytechnic, Pusad etc. for the Guest lecture on “Developing Interview Skills”.

6 thoughts on ““Similar” Does Not Mean “Same”

  1. I also thought same like Sameer… IPO will give return… but after tracking 4-5 IPO, realised it’s not true… in article also explained well👌👌

    1. Thanks for your valuable feedback.

      Yes, many investors have this notion.

      Thus, we have tried to address this in this article.

      Thanks again.

      Looking forward to more visits and feedback in future.

  2. Saurabh Bhai that is the one quality I most like of yours is your command on current subjects or “Hot Topics” is very impressive. Whenever any hot topic comes you are bang with your article to help clients like us. Keep writing and educate us.

    1. Thank you so much for your kind words Hasan.

      Request you to share this article with your family and friends so that they can also benefit.

      Looking forward to more visits and feedback in future.

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