...those of us who aren't technically inclined probably all have a fair market value in mind for the stocks we follow. Apple for a time was trading substantially below mine. That made it a buying opportunity for me. From here, it's a different question. Apple seems fairly valued now, so the risks are greater. Simple as that. Sure, but again, that's opinion. Markets weigh opinions of all types by allowing the interaction of supply/demand. While you and others might have thought $400 was a low-risk bargain of a lifetime, others thought it was a grossly overpriced stock because of the market share, margin, and profit trends. At today's level, it's the same situation... there are many who look at the very low multiple, presume profit growth and big new products on the horizon, and "know" that it's a great deal at $800, let alone $625. And others (like me) are waiting for the iPhone to follow in the footsteps of the iPad and profits start to decline. If you "know" the bearish view is much less likely to pan out than the bullish one, then be rational... gather (and borrow, beg, and steal) every dollar you can and buy some call options!
This ongoing commentary about AAPL being "knowable" as a low-risk investment and much more certain to go up than down is nonsense. The market weights all available information and opinions, and there are objective risk metrics that mean a lot more than select opinions. |
