You probably read about the recent Internet scam involving Emulex stock. It seems that a former employee of Internet Wire, a news-release service, dispatched a bogus release on that news service saying that Emulex would have to restate earnings and was being investigated by the SEC. The release caused massive selling in the stock, reducing Emulex's market capitalization by roughly $2.5 billion.

There are several lessons that can be learned by the Emulex hoax. For starters, you should always investigate before you invest. We live in an age when information is disseminated at the click of a mouse. Analysis of this information, however, should take longer than that. Indeed, one should not accept as gospel everything that is read, either in the papers or online.

Another lesson is that trading on any bit of news that comes out on your company is probably a good way to lose big bucks over time. Remember that we live in an age when every corporate announcement or development is magnified in importance. Quite frankly, what often passes as "news" is nothing more than filler for the business media. Don't feel you have to make decisions based on every development that comes out about your stocks. Chances are, most "news" is just noise and has very little lasting value.

This is not the first hoax of this kind on the Internet, and it surely won't be the last. And the next time it happens, I'm sure there will be countless investors who lose money because they acted before they analyzed the situation.

Make sure you're not one of them.