I receive a large number of emails, many of which are showing that some Apple AAPL investors are becoming anxious.
Who can blame them? The stock market continues to go up, but Apple stock continues to underperform. The price action in Apple yesterday was especially negative.
Relax, all is well! As I have written before, Apple stock has a history of running up into a product announcement, and then underperforming for the next 30 days. The recent price action in Apple is in keeping with its historical pattern. There is nothing extraordinary, and there is nothing to worry about, at least not yet.
Moreover, there are several reports that Apple will announce a mini iPad on October 17, and the stock may start running up in anticipation.
A quick look at Apple stock chart shows that it has pulled back many times, and then made higher highs.
Investors who are experiencing anxiety over Apple stock performance simply have made mistakes in how they have handled this investment. It is best to not get into a situation that causes anxiety in the first place.
Here are a few pointers to help from the ZYX Change Method with Apple as an example.
Position size too large
The best I can tell a majority of investors who are experiencing Apple anxiety have a position size in Apple that is too large relative to their portfolio size.
It is best to limit each position to a size in the portfolio so that no single position can cause anxiety. Such position size is known as “Full Core Position Size” in my method…Read more at MarketWatch
