Jaime, I am not taking anything out of context. I also have shorts to hedge my longs. Clearly, if the Dow flies to 8000 next week Apple will go up a bit. Not much, though. Being short Apple and other stocks reduces the volatility of returns for my portfolio without an adverse effect on the mean.
Besides, my Apple short is, at this point, profitable (I shorted around $18 1/2).
I suspect the next earnings announcement is going to be devastating for Apple. The problem is now they are competing with themselves. Why buy a Mac if next year their OS will be on Intel? Why buy Apple's OS if next year Apple will have a completely different, incompatible OS? This is a common problem for companies who promise upgrades, not unique to Apple, but in their current situation it is extremely damaging. I can bet their sales are going down the tubes (in fact, I am making such a bet). Remember also that CompUSA and others have been reducing their shelf space.
I think Apple is finally getting its act together in some ways, with the move to an object oriented OS, and the "javatization" of their APIs. I would really like to see Apple succeed, but thinking coldly about it, the odds are it will not. |
