Oh, I don't doubt that AAPL options are great when it comes to spread, volume, and liquidity and are darlings of many traders. Personally, I'd rather trade something that's more predictable to my way of thinking.
I know. The internet sales TAX was introduced in Congress this week. That will kill AMZN hype.
I shorted from $242 to $220. But out. I am not shorting for some reason of using best money percentage bets.
See my posts on the AMZN board. I'm more confident in that than any short ever. Selling devices at a loss is a horrible strategy. The value captured selling content is trivial. Apple, with 100 times larger installed base than AMZN has generated a few billion in royalties from its music and app sales. I work through some simple math, but it will consume cash for the next 1.5 years...
Within 3 months, there will be a plethora of devices with superior specs and equal price point to AMZN. When Google formally launches its digital storefronts, there won't be any advantage to being locked into AMZN's store. By the time December rolls around, hype will give way to Lenovo's Ideapad, Vizio's tab, etc etc...
Apple averages about 6 downloads per device per month. At $1 per download and 30% fee, that's $1.8 margin contribution per month. 12 months... for Fire sold through BestBuy (where AMZN probably loses $50 a device) even the content sales barely make it profitable OVER THE LIFE OF THE DEVICE.
It is an EPIC joke. It is value destruction spurred on by capital markets sending false signals from institutional manipulation. All growth is not profitable and all growth is not good.
There are thousand of listed stocks with more than few hundred that are good option candidates. For the life of me, I don't understand why someone would trade Apple. If I was a 1000+ million dollar fund with fewer options then I can understand but unfortunately I am not currently in that position. For that reason, I have not once via stock or options traded Apple in more than a dozen years of my trading experience. When you have the likes of LULU, CMG, and FFIV, and OPEN, who wants APPL.
Yeah I was buying puts on GMCR for over a quarter and had 2000 shares short at 108 and covered at 103. The problem with overpriced stocks is that they can often times goes up longer than you have money to buy worthless puts. I don't know if AAPL is in trouble per say but obvious stock purchasers for the short run are not interested in owning it. Since I have been trading for close to 30 years and have NEVER seen a trading enviroment like this one I will take a pass on AAPL and have bought up the AMZN Jan 215 Calls as this traade is based on the perception of gaining market share regardless of the cost of the Kindle Fire because they have so many ancillary products to sell which make it a greater threat than AAPl in my humble opinion. As for the 75-90B in cash its no doubt impressive, however I sold MSFT in 1999 for 109 a share (my purchase price was 20) and everyone said i was crazy, it proceeded to go to 120 with in 2 weeks and I was still happy to get out. It split 2 for 1 at 60 and its been trading under 30 for atleast 5-6 years and they too once had 75B in cash which they distributed in a one time dividend. However, APPL seems to have more up its sleeve than MSFT (we hope).
You beat me to it techstrat. I love the story of how Apple "missed" this past quarter. At the end of the day the market is definitely controlled one way or another by the institutions. I get that technically, if the analyst say they expect one thing and the company doesn't meet those expectations than it is considered a "miss". Logically however netting $26B, 88% more that the previous year is a freaking WIN despite what any analyst tells you.
Now I do believe there is a little bit of "fire" behind the thought that they will sell less iPads in Q4 with the release of the much cheaper Kindle Fire and now the Nook Tablet. I'm not comparing these products here, I'm only stating that sales of those two devices is going to eat some of the iPad market share, there is no denying that. So these next two quarters may see slower growth in the tablet sector for Apple, but I would also expect that they will still continue to grow in that space as well as everywhere else they are present. If there is ant decrease in revenue for Apple it will be short lived once when they announce an iPhone 5 and iPad 3 next year.
Speaking of AMZN tech, you've spent more time researching them than I have, but I would caution you on betting against them right now. Don't under estimate the effect the sell of Kindle Fire tablets beginning next week. Despite Apple's dominance, and despite the sudden offering from B&N the Nook Tablet, the Kindle Fire is going to sell into the millions this season and you'll need to account for the hype surrounding that. Again I'm not arguing the merits of the device, but I will argue that with a price tag of $199 it will be a hot item going into Christmas, especially now that they've announced support for other Online services such as Netflix, Pandora, and Hulu. Even if they are selling these at no cost or at a loss, they will still benefit from the hype of doing what no one other than Apple has been able to do.
Then again the market is all about the spin machine, remember Apple "missed" last quarter so suddenly the company was worth billions less within 5 minutes. AMZN will have a phenomenal holiday season but then 10 institutional analyst might only want to talk about what the cost is to produce the Kindle Fire, how the Nook had a decent holiday season, and how in 6 months Apple will debut the iPad 5.
It's all a bunch of BS. Just look at the recent article on LULU this week a lone. Not one warning about what this stock could really do. Not one mention of how terrible the volume has been going back to the previous week, no consideration for the fact that in a 250 point plus day for the market LULU was flat, but really in the red for a bulk of the time. "Base with a perfect handle"... who the F are the kidding.