Raptor Pharmaceuticals: Another Case Of Mistaken Identity

Web-reading bots have made traders millions of dollars in profits in recent years. These automated programs scan newswires and social media sites looking for market-moving headlines and then automatically trade stocks and options based on the sentiment of those headlines.

Ideally, traders end up making serious bank by beating other traders to the trade.

However, sometimes the bots get it wrong, particularly when it comes to identifying the correct stock to trade.

Back in 2014, Facebook Inc FB acquired virtual reality technology company Oculus VR. On the day the deal was announced, shares of Canadian company Oculus VisionTech spiked more than 100 percent when bot traders mistook the identity of the company.

Of course, the stock quickly reversed direction.

Related Link: Terms Of The Trade: Contrarian Investing

In 2015, Tesla Motors Inc TSLA announced a buyout of auto supplier Riviera Tool LLC. Shares of similarly-named pinksheet stock Riviera Tool Company RIVT soared 12,000 on the news.

A similar story likely played out on Friday when shares of Raptor Pharmaceutical Corp. RPTP jumped more than 8 percent in pre-market trading. Benzinga Pro reported that the move was likely due to a positive news story about a Virginia school system using machines produced by Raptor Technologies.

Once traders identified the correct company involved in the report, shares of Raptor Pharma plummeted and are now down 4.2 percent on the day.