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Advice for 5-to-10 year nanotechnology investors

Phil McCallister warns over at SeekingAlpha that some investors fall for nanotech hype:

owever, investors have been burned (charred to a crisp actually) by the big Nanotech hype back in January of 2004. Remember that? George W. Bush signed the 21st Century Nanotechnology Research and Development Act in 2003, and continued mentioning nanotech throughout the year. Investors went nuts, buying anything with nano in the name – pushing stocks like Nanogen, Inc (NGEN) and Nanophase Technologies Corporation (NANX) well above $10 a share.

Frankly, anyone who invests on such a weak basis is likely to lose his/her money pretty promptly. The companies mentioned may be good investments, not because they have nano in their name. For those looking for a more sensible nanotech investment, McCallister suggests Harris & Harris:

Since 2002, Harris & Harris has made 30 investments in startups that specialize in what it calls `tiny technology’. Charles Harris switched to nano-only deals that year, making Harris & Harris the only publicly traded VC firm devoted exclusively to nanotechnology…If you’re looking to broaden your portfolio with a stock that is fairly low risk and has the potential for big returns over the next 5-10 years, you should include TINY in your long term portfolio.

It’s harder to invest in longer-term prospects such as atomically-precise manufacturing. I would suggest Zyvex, but they aren’t publicly traded at this time. Neither is Nanorex.

If you do this and get rich, please remember Foresight in your annual giving! —Christine

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