Suppressing AAPL

Compelling piece by Joe Springer on Apple’s stock price, from back in November:

So here is our logic to being patient. It is threefold:

  1. Apple had an enormous amount of call options speculation related to its Summer surge

  2. A huge share of this was calls with a strike of around the current price of $550 and higher that expire January 19 2013

  3. The institutional money managers that wrote those call options and bought common stock to cover will make a lot of money if a) those options expire worthless, and then b) Apple runs after that expiration date

Billions of dollars at stake if AAPL stays near or under $500 a share until January 19 and then makes a run after that. No tinfoil hat required to see the motivation here. (Via Loren Brichter.)

Tuesday, 15 January 2013