An interesting see-saw price action has developed between shares of Apple (AAPL) andFacebook (FB). When Facebook stock goes down, Apple stock goes up and vice versa.
Going into the Facebook IPO, it made sense that investors were selling Apple stock to raise money to buy Facebook shares, but when Facebook did not open as high as some had hoped for, investors started selling Facebook and putting money back into Apple. When Facebook broke the syndicate bid at $38, the floodgates opened and money poured into Apple. As the chart shows, Apple staged an explosive rally.
Today, Apple opened strong, and went up in the morning, but when Facebook shares stabilized, money started pouring into Facebook and Applestock started falling. It’s like the popular Whac-A-Mole game in which smacking one mole’s head causes another to surface from its hole.
The stabilization in Facebook may have resulted from Needham initiating Facebook with a buy and $40 target, as well as a report this morning that Mark Cuban had purchased 150,000 shares of Facebook. Cuban purchased 50,000 shares each at $33.00, $32.50, and $31.97. Cuban calls it a trade, not an investment.
It appears that some investors are placing bets that Facebook has bottomed and they no longer need the security of Apple.
It appears that some investors are placing bets that Facebook has bottomed and they no longer need the security of Apple….Read more on Forbes
