Ah, the magic of a prefix. Thanks to the two following little syllables, "nano," I recently tuned in to the buzz around a small maker of measuring instruments for the semiconductor and wireless industries, Keithley Instruments (NYSE:KEI).

"Nano," of course, is Greek for "100% increase in market cap." But a recent newspaper article describing Keithley's nano-prospects provided only a modest (and quickly reversed) boost to the company's stock price. That's pretty odd these days. Especially considering feeding frenzies like the one at Altair Technologies (NASDAQ:ALTI), a company with a dubious tech pedigree that seems to produce nothing more technologically advanced than very small rocks.

Keithley, on the other hand, produces the kind of products that could be of actual use in nanotechnology. The firm's instruments measure tiny electrical charges, among other things, and are used in the semiconductor and wireless industries. Keithley's current technology, scaled down, would allow for accurate analysis of these new wonder materials. At least, that's the plan.

Right now, the nanotechnology field is still developing. The industry lacks measurement standards and equipment capable of scrutinizing nano-materials. (It's difficult to know how much cargo your nanotube space elevator can haul into orbit if you don't know how tough your nanotubes are.)

Keithley hasn't exactly been a money-making powerhouse, however. The company just turned in a modest profit for its 2004 Q1, with big increases in orders from Asia and Europe. But a look at the past few years shows that earnings are pretty rare. Is nanotech the cure for Keithley? To its credit, management isn't saying any such thing. Nobody's screaming about an up-and-coming billion-dollar market -- a refreshing change from some of the industry hype.

The message here certainly isn't "buy Keithley" on the hopes that it's the next nanotech whiz kid. Just keep your eye on it, and the ongoing developments in the industry. Like any new and exciting field, there will be those who strike gold, and those who go bust. Investors will need to be careful to make sure that they end up on the right side.

Get in on the nano-action on the Fool's Keithley Instruments and Nanotechnology discussion boards.

Seth Jayson thinks all prospective nanotech investors should read Mark Twain's Roughing It. Send post-structuralist interpretations to him viaemail.