Sunday, January 27, 2013

The Apple loses it's Shine

Boy! When the market turns on a stock it really turns.

Do you remember just less than a year ago analysts at this price for Apple stock (aapl) were crying buy, buy, buy. 

The current levels of less than $500 per share are actually still attractive. I personally sold all but a rump of Apple stock after New Year. That followed a sale in October as the stock fell from its high.

I had some leeway as to when to sell as I had average price levels of $350 per share so I still made some money.

At the moment I will hold back my few remaining shares are held at an average price of $290, if Apple get below thatI would be in for a buy anyway, unless there is some major calamity to make me step away.

Last year analysts saw prices for Apple at $1,000 per share, today they are selling off like yrsterdays french fries.

The last few weeks has been a perfect example as to why an investor should diversify. If you had all your money in Apple and had bought higher than the mid $400 level you would be hurting badly.  No one will call this a bubble, but it was and the bubble on the stock has definitely burst.

Apple as a company still appears to have great prospects, if management doesn't panic and begin to chase the stock.

Keep the brand as an aspirational brand, don't go down market.

Keep a pipeline of genuinely new goods coming forward. Don't re-hash old ideas as improvements.

Don't play a blame game at the top. Firing board members and wailing a long lament.

If Apple does ANY of these things, I would be out of the stock at all costs. If they keep a cool head there will be talk again of the $1,000 stock price in a year or two, though  this shock may weaken investor confidence for quite a time.

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