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Robert McDonald  

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  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]
    Shadac, Don't buy into market folklore. There are no rules about market crashes that are written into any law of physics. Every time things are different. This time, with all the money that has been stuffed into the world money supply, more and more continues to find its way into the most successful stock markets. With the US being the most reliable stock market for several years to come you will find a very large fraction of the money there. CSCO, HPQ and MSFT are yesterdays stocks. Put your money where the growth is. Right now that is in the mobile web buildout and all the ancillary on-line tools and products including Apple, FB, Alibaba (Yahoo), Skyworks and maybe IBM given the Apple enterprise partnership. Use LEAPs and longer term options call options for leverage. Read the section on call options in Options for Dummies and forget all the spreads, puts and other crap that people push that compromise payback. Just think basic buying call option strategies. Don't sell calls as the payback is too small and if you use any margin at all you will find huge dents into your available capital.

    The rich are not pulling their money out. Look at the growth in money under management at successful hedge funds as well as Blackrock and Goldman Sachs.
    Nov 28, 2014. 11:03 AM | 2 Likes Like |Link to Comment
  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]
    Gary J,

    I 'll take my tax problem anytime to the more limited gains you have had paying full price for Apple stock and then just holding. Crying all the way to the bank.

    If you do the math you will see what I mean.

    I follow my investments whether they be stocks or options Monday-Friday for an hour or two. Yes some days it may be more for example when the Apple earnings report comes out or new products are introduced but this is the exception. Believe me the equivalent hourly rate I am being paid in return for this effort is well worth it. And if you don't watch your investments regularly someone may be eating your lunch or you will have many lost opportunities.

    I have been retired for over 16 years now, thanks to this very kind of investment activity as funded early on by my Intel employee stock options exercised over the 1979-1998 period. I have "learned" that my efforts in following my investments and the business world are not only entertaining and enjoyable but have also paid off very handsomely. I not only have plenty of time to pursue other interests but also plenty of money to make my participation in this interests and the rest of my retirement life pretty cushy. But thanks for asking.
    Nov 27, 2014. 03:32 PM | Likes Like |Link to Comment
  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]
    Exercising a LEAP or OPTION means that you ponied up the strike price and purchased the stock using the LEAP up in the process. In other words if you are holding an Apple LEAP with strike price of $90, and you want to buy 100 shares at the $90 price you have to come up with $9000 cash and the 100 shares you held in the form of LEAP are gone. You exercised them. You do not have to exercise all of the shares in the LEAP but the ones you exercise are subtracted from the ones you have an option to buy at $90. I may very well do this by year end to push gains into 2015 and if it works out, hold those shares until they become everything becomes long term capital gains in Dec 2015. The basis for that purchase would be whatever you paid for the 100 share portion of the LEAP as well as the $9000 cash you paid at the time of exercise. I hope that makes sense.
    Nov 27, 2014. 03:21 PM | 1 Like Like |Link to Comment
  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]
    Hi Willy,
    I lost a lot of money on those April 2013 calls. That was a bad mistake on my part. I learned one more time that the market is not rational and the overreaction to Android market share gains resulted in a way oversold Apple. We now know that Android is indeed crapware and the world is finally figuring this out.

    Here is just one of many examples of how bad it is:
    The Tablets mentioned in this article are the kind of tablets contributing to what some are claiming is increasing Android market share. Well sales of this kind of junk are just one more reason that people are finding out it is better to pay more for Apple products so you have something that really works and is free of malware.

    Samsung is going down and Xiaomi is condemned to the mid and low range market as a result of Android's failure in enabling production of quality bug free products.

    We also now know that buying LEAPs and shorter term options during that 2013 dip was a very good investment that is paying off handsomely now.

    Now that I have burned off all my 2013 losses with short term gains this year I am starting to feel the tax bite too. When I gave my accountant a summary of my gains for this year he informed me that I now have a 5 figure tax bill for 2014 due April 15, 2015. As a result I have stopped selling until January and just switched back to holding the LEAPs I still have for longer term capital gains, a number which are up over a 100%. Now that's a nice problem to have.

    I also again believe that a longer term hold on in the money Apple LEAPs is again a fairly safe investment.

    I trust you know that you can exercise a LEAP before it is eligible for long term capital gains treatment and if you hold the stock for an required period of time you qualify long term treatment. The time you hold the LEAP before exercising counts in full as part of the capital gains holding period. At least the IRS has never questioned this when I did this technique several time in the past (beg for forgiveness or check with your accountant just to be sure).
    Nov 27, 2014. 01:50 PM | Likes Like |Link to Comment
  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]
    Hi Willy,
    Glad it is working our for you. Buying Apple LEAPs when Apple was sold off has been a very profitable enterprise. Apple stock is now at the equivalent of $823 pre 7:1 split with $1000/sh a fairly easy shot at this point.

    Now lets see. If you shorted Apple stock at $400 dollars/share back when Blair was telling you he thought it was a good idea, you would have lost $423 per share by now. And that's ignoring all the carrying cost and lost opportunity. If you had bought Jan 2015 Apple LEAPs back then, you would be up on the order of 9X what you paid or 900%. That's the enormous leverage of being right and using LEAPs.

    I for one no longer hold a LEAP or long term options when they have over a 100% return. I sell them, take some profits and rebuy the equivalent of the same amount shares or even a few more further out in time at a higher strike price compounding the result several times over. I have discovered that out of the money 6 mo calls and LEAPs pay a higher rate of return than at the money strike prices.

    This is a very nice tax problem to have.

    Maybe we should take a collection up for Blair so he can find a better paying line of work.
    Nov 24, 2014. 12:15 PM | 2 Likes Like |Link to Comment
  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]
    PS: As to the temporary iPad decline, you might want to take a look at what the IBM-Apple partnership is about to do in the enterprise where enterprise is the business world in case you were wondering.
    Nov 18, 2014. 11:17 AM | 20 Likes Like |Link to Comment
  • iPhone Surging, iPad Collapsing - Apple May Be Near Its Peak [View article]

    Ugh, you reminded me of how your shorts must be doing before I had my cup of coffee. Take a look here:

    And here:

    But I suppose you like seeing things the way they look in your world. Everyone to their own misery if that's the way they choose to have it.
    Nov 18, 2014. 11:08 AM | 13 Likes Like |Link to Comment
  • Did Apple Pay Just Lose Billions? [View article]
    The hacking could not happen to a more deserving set of companies. These folks have no ethics and are out to exploit their customers including what should be private information regarding purchased prescriptions and other health care products. You can tell way to much about a person's private interests and other matters. And yes Google has the same problem which is one reasons Android users are migrating to the Apple ecosystem
    Oct 29, 2014. 12:56 PM | 16 Likes Like |Link to Comment
  • Stop The Insanity: Apple Doesn't Have An 'iPad Problem' [View article]
    RIGHT ON ROCCO! Unfortunately Analysts have to publish something on companies they cover regularly or perish! Their paycheck is dependent on being a talking head whether what is being said is relevant, accurate or whatever. And then we have all the stock price manipulation going on like the recent BS pronouncement by the CEO of Micrchip:

    Russ Fischer did a nice job of explaining some of the background on that one:

    The really smart individual investors are the ones who do their homework and know better. They bet against these kinds of pronouncements. It is one of the best way to make big bucks on intermediate and long term call options (LEAPs) that I know of. I just made a tidy bundle by buying call options on Skyworks right after the CEO Microchip announcements.
    Oct 22, 2014. 12:52 PM | 2 Likes Like |Link to Comment
  • The GT Advanced Technologies Debacle: Where Does Apple Go From Here? [View article]
    if it was always for the watch, why did they need for GTAT to acquire so many crystal growing machines. And I would make the point that sapphire crystals will be just as brittle in watches, probably too brittle to be realistically used.
    Oct 15, 2014. 09:31 PM | 1 Like Like |Link to Comment
  • Why Is Apple Undervalued? [View article]
    Carl Icahn now gets it and that is a very good sign. He has come a long way in a year.
    Oct 14, 2014. 07:14 PM | 4 Likes Like |Link to Comment
  • Why Is Apple Undervalued? [View article]
    @BioAddicted: Thanks for your post on Deutsche Bank. No one that had completed a minimal amount of research would downgrade Apple stock at this point in time unless the agenda was stock price manipulation.

    @Ryan Jones -- Good premise but your over focus on financial data and history vs. the changing nature of the wireless web and it's expanding role and utility in daily life including the Internet of Things. As a result you have come up with very shortsighted conclusions. Apple is much bigger than a wireless phone company.

    Apple's technology, business model and ecosystem are in prime position to dominate profits of one of the most rapidly expanding business areas in the world. Any stagnation is temporary and is only happening because a majority of analysts, pundits, and investors have yet to understand this reality.
    Oct 14, 2014. 06:53 PM | 5 Likes Like |Link to Comment
  • Apple's iPhone 6: It's Not About The Specs, It's About Usability [View article]
    Samsung's over emphasis on specs has led to a serious mismatch between display and graphics processor capabilities leading to sub par graphics performance. This is what happens when products are designed for specs in an advertising piece vs actual device performance:

    "Samsung Galaxy Note 4 delivers poor graphics performance vs. Apple iPhone 6 Plus"

    Its like spending thousands of dollars on high fidelity sound equipment that goes beyond the ability of the human ear just to have higher advertised performance. It is waste of money for both the consumer and the manufacturer and it can lead to inferior products due to lack of focus on the right priorities. Never buy a product solely on claimed performance as measured by specifications. Always read reviews and understand what performance is of best in terms of benefit to you. The highest and best benefit is achieve by products based on device performance as measured by human experience, at least to the extent possible. Product reviews by experts like Walt Mossberg are a good starting point.
    Oct 12, 2014. 03:08 PM | 12 Likes Like |Link to Comment
  • The GT Advanced Technologies Debacle: Where Does Apple Go From Here? [View article]
    @J. M. Manness I like reading your articles a lot. They are very far sighted and credible. By way of one difference, I never said that anybody was swindled here, not even close. When companies push the state of the art with an immediate production goal, the risks are huge. In this case I would say they were monumental with the possible exception of using sapphire a watch crystal. However I would never buy a watch with a sapphire crystal until there was convincing evidence that the crystal would not shatter by what most would consider an accidental direct tap with a hard object like a belt buckle (that is how I managed to shatter my iPhone 4S display glass).
    Oct 12, 2014. 02:54 PM | 1 Like Like |Link to Comment
  • The GT Advanced Technologies Debacle: Where Does Apple Go From Here? [View article]
    Laminating layers of glass and sapphire for a commercial product sounds like wishful thinking and a university research project to me. This adds many additional layers (no pun intended) of complexity and opportunity for failure. I do need to say that I am not an expert in the advanced research in this area. In addition there are too many other great investment opportunities that need attention that would successfully compete with researching such a topic.

    I also totally agree that the Gorilla glass being used in iPhones is highly scratch resistant. Improvements here do not make any sense to me. The Apple watch however may be another matter. I have never ever had a scratch on any iPhones but I have had plenty of scratches on high end watches I have owned. I also have had two iPhone displays crack catastrophically due to my mishandling. I would not like anything that fractures as easy as sapphire in any iPhone I own unless some miracle of materials science research can be used to change what appear to be fundamental properties of this material.
    Oct 12, 2014. 02:41 PM | 1 Like Like |Link to Comment