Fiddy, who recently made $100m by investing in a bottled water firm that was bought by Coca Cola for $4.1bn, is now stretching his newly developed Wall Street muscles and urging his Twitter followers to invest in HNHI, a company he and his G Unit funnily enough own 30 million shares in.
His weekend of tweeting saw the stock rise nearly 400% after many of his followers jumped on board. He tweeted instructions on what to look for and why people should invest in the firm, which makes audio products that are being endorsed by Monsieur Cent, promising people will "double their money" and also promised investors that he would "technically work for you".
Of course, this could be a sound investment and proof that social media is a great way of getting the inside track on Wall Street. But then again it might not.
It is doubtful that many of 50 Cent's followers are particularly financially savvy or indeed very affluent, especially in this climate. Also, his caveat of telling tweeters to "just get what you can afford" probably doesn't cover much of the SEC regulatory stipulations when it comes to financial advice on stock trades.
The investors have indeed doubled their money from the buzz round the stock but most pros will tell you that a small firm that hocks audio accessories might not be the safest bet in depressed 2011 America. It will be interesting to see what the SEC says about celebrities telling their followers to invest in them via Twitter and it will be even more interesting to see how long Mr Jackson holds onto this stock...and how much his fans lose out on.
UPDATE: It turns out 50 Cent has now made $50m from this cunning enterprise but has conveniently deleted the tweets he sent out over the weekend. Here's some screenshots though, just for posterity (and maybe for the SEC to look at).
He's also since posted: “I own HNHI stock thoughts on it are my opinion. Talk to financial advisor about it.” and “HNHI is the right investment for me it may or may not be right for u! Do ur homework”. Retrospective financial advice - nice.
UPDATE 2: Here's a prospectus for HNHI that explicitly admits that the firm may never be profitable, says the auditors have the company down as a concern and that the stock may be worthless.
Great blog here from CBS explaining how illegal this may be.
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