Apple Inc. AAPL The stock has been falling, falling 11% for the year and hitting a 4-month low. The tech giant is struggling as the S&P 500 is up almost 7% in the same period.
Because?
The most recent drop, close to 3% on the day, came after discouraging figures were reported in China. The phone maker's iPhone sales fell 24% year-on-year in the country as people turned to local alternatives such as Huawei.
This was just a day after European Union regulators fined Apple $2 billion for violating EU antitrust rules with its App Store policies. The stock fell 2.5% following that news.
And recently the company announced the closure of its electric car program. The $10 billion, 10-year effort was halted after Apple's top brass decided it was no longer feasible to carry it out.
But probably the company's biggest stock loss has been its lack of participation in the AI boom. Apple has been silent on this front and many believe the company is behind the curve.
The buffet movement
Berkshire Hathaway BRK owns a huge stake in Apple, almost a billion shares, or 6% of the company. Buffet started his stake in the company in 2016, when the stock was trading at around $22, and ended up accumulating his stake in 2018, when the stock was still under $50. He has enjoyed a huge return on investment and now may be the time to exit.
How to get out will be complicated. Berkshire must report its holdings on Form 13F. If the next one, scheduled for May, shows Buffett divesting Apple, it could start a chain reaction, as many in the investing world pay close attention to Buffett's every move.
bulls and bears
For traders who believe in the bearish case and want to profit from a drop in APPL, inverse ETFs can be a great option, ETFs like those offered by Direxion. The innovative fund manager offers two options on APPL, one for bulls and one for bears.
He Direxion Daily AAPL Bear 1X Stock AAPU seeks daily investment results, before fees and expenses, of 100% of the inverse (or opposite) of Apple Inc.'s daily performance.
He Direxion Daily AAPL Bull Stock 1.5X AAPD seeks daily investment results, before fees and expenses, of 150% of the daily return on Apple Inc. common stock. AAPL.
Photo by Priscilla Du Pérez in unpack
