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Apple's Next Move

|Includes: Apple Inc. (AAPL)

Apple's share price has led the market lower over the past weeks. Some die hard longs are getting nervous as the stock flirts with official bear market territory. But Apple could squeeze the shorts with a simple maneuver that wouldn't impact the companies balance sheet one iota.

If AAPL were to split its shares on a 10:1 basis, the stock would be trading around $56, instead of $560. The lower per share price, plus increased liquidity and reduced spread, would allow a new wave of investors to buy AAPL in 100 share lots. It would also allow mom and pop investors to easily implement option strategies. Covered call writing, naked puts, and collars are simply out of reach for average net worth investors right now with a 100 share lot of AAPL costing over $56K.

The time has come. AAPL needs to split its shares. In doing so, another wave of new money can enter the stock and be the catalyst that will send the stock on its next wave higher.