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Apple’s Run Is “Not Finished”: Josh Brown Says Fund Managers Can’t Resist It

Morgan Korn

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Apple (AAPL), riding high after a jury ruled that competitor Samsung had infringed on its intellectual property, filed papers Monday to ban U.S. sales of eight older Samsung smartphone product, including the Galaxy S 4G and the Droid Charge; Samsung's top-selling Galaxy S III was excluded in patent lawsuit. The news helped drive shares of Apple to another record high on Monday and the stock has gained more than 66 percent since January.

Josh Brown, vice president of investments at Fusion Analytics and author of The Reformed Broker blog, says Apple's run "is not finished" and his July call that the Cupertino, California-based company was poised for a "really big" second-half rally seems to be right.

Investors are pouring money into the iPhone maker because "this is the stock that when people don't know what to do, they go to Apple," he tells The Daily Ticker's Aaron Task and Henry Blodget.

Hedge funds in particular have been increasing their stake in Apple over the past few weeks. It's becoming "a notorious hedge fund hotel," Brown quips. About 230 hedge funds hold a large position in Apple and that could number could rise to 350 according to Brown. Major market indexes may be hovering near all-time highs but many sectors are lagging and Apple presents one of the surest bets for hedge funds and portfolio managers who are underperforming the market.

"Apple is like the 'catch me up' vehicle," Brown notes. It's "the stock that moves the chains."

Apple stock took a hit when it reported lackluster fiscal third-quarter results last month and has rebounded partly on the hype surrounding its release of the iPhone 5, which could be announced on Sept. 12.

Brown says Wall Street insiders are following the stock closely for other reasons than just its rising stock price. It reveals more about consumers than monthly consumer surveys, he notes, and has become "psychologically important" for the markets. Consumer confidence may be at nine-month lows but consumers are still spending, even on high-priced Apple products, Brown says.