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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Kurthend who wrote (173547)	9/2/2014 11:34:24 PM
From: rnsmth	Respond to of 213177

<<But, is that gambling or investing?:)>> It depends on how you do it.

To: Kurthend who wrote (173547)	9/3/2014 10:41:43 AM
From: Ryan Bartholomew	Respond to of 213177

But, is that gambling or investing?:) Especially, if you think that buying puts on one of the most profitable and well run companies is an investment. Options are a zero-sum game while equity ownership is not, so from that perspective, you have a point. But the underlying company's past and current profit level or management isn't a determinant of expected return. A wildly profitable company with skilled management, a broad product portfolio, and everything else in their favor can still have all this priced in and be subject to a correction in price just as readily as a company with all of the opposite factors. Also, premiums generally reflect expected volatility. It really comes to a game of whether you can be "more correct" than the average expectation, not whether the average expectation is good or bad. Apple has a particular vulnerability WRT its concentration of profits reliant upon one product - the iPhone. If, for any reason, the iPhone took a serious hit in popularity, the company profits would swoon. That has worked in their favor for many years as well, as the same concentration has meant that Apple's profits skyrocketed for a few years when the iPhone sales were doing the same.