Most money managers bungled Apple stock in 2014, missing out on huge gains
Following a disappointing 2013, most professional investors decided to pass on Apple this year, and as a result missed out on one of 2014's biggest success stories on Wall Street.
Money managers who missed out on Apple's gains this year were highlighted as one of the worst blunders in finance in 2014 by Bloomberg. Shares of Apple rose four times more than the Standard & Poor's 500 Index this year, but professional investors who stayed on the sidelines are now behind on benchmark indexes by the most in almost a decade.
Institutional investors opted to stay out of AAPL stock in 2014 after the company trailed the market in 2013 by its greatest level this century. Investors predicted the trend would continue this year, and that Apple's growth would stagnate.
Instead, Apple saw significant growth throughout the year of the iPhone platform internationally. The company then followed up with strong Mac sales, a blockbuster launch of the iPhone 6 and iPhone 6 Plus, and the heavily hyped unveiling of the Apple Watch.
Bloomberg noted that among the 278 funds benchmarked to the S&P 500 and with at least $500 million in assets, only a fifth hold shares more than their representations in the index.
Shares of Apple have been on the upswing since late April, when the company beat estimates with $10.2 billion in profits on sales of 43.7 million iPhones. Then the company blew away expectations in October, earning $8.5 billion in profit on sales of 39 million iPhones and 5.5 million Macs.
Following Apple's blockbuster September quarter, Wall Street analysts began revising their estimates higher, helping push shares of AAPL to new all-time highs this fall. Investors have been looking to buy in to the company ahead of the conclusion of its December quarter, which is expected to set new records for iPhone sales in the face of overwhelming demand.
Money managers who missed out on Apple's gains this year were highlighted as one of the worst blunders in finance in 2014 by Bloomberg. Shares of Apple rose four times more than the Standard & Poor's 500 Index this year, but professional investors who stayed on the sidelines are now behind on benchmark indexes by the most in almost a decade.
Institutional investors opted to stay out of AAPL stock in 2014 after the company trailed the market in 2013 by its greatest level this century. Investors predicted the trend would continue this year, and that Apple's growth would stagnate.
Instead, Apple saw significant growth throughout the year of the iPhone platform internationally. The company then followed up with strong Mac sales, a blockbuster launch of the iPhone 6 and iPhone 6 Plus, and the heavily hyped unveiling of the Apple Watch.
Bloomberg noted that among the 278 funds benchmarked to the S&P 500 and with at least $500 million in assets, only a fifth hold shares more than their representations in the index.
Shares of Apple have been on the upswing since late April, when the company beat estimates with $10.2 billion in profits on sales of 43.7 million iPhones. Then the company blew away expectations in October, earning $8.5 billion in profit on sales of 39 million iPhones and 5.5 million Macs.
Following Apple's blockbuster September quarter, Wall Street analysts began revising their estimates higher, helping push shares of AAPL to new all-time highs this fall. Investors have been looking to buy in to the company ahead of the conclusion of its December quarter, which is expected to set new records for iPhone sales in the face of overwhelming demand.
Comments
Those "pros" must have listened to the "pro" analysts. What a bunch of out of touch fools!
The average hedge fund didn't even make over 10% for their return last year, not even close to it.
Many amateurs have done far better than that.
Those "pros" must have listened to the "pro" analysts. What a bunch of out of touch fools!
The average hedge fund didn't even make over 10% for their return last year, not even close to it.
Many amateurs have done far better than that.
I think amateurs will take more "risk" on a stock. A fund manager does that and a whole bunch of people will rain down the hate. Of course, if the manager was right, they would be considered a genius and visionary. There is no real winning for them.
There are some people on here I would more trust with my 401K than the company that currently holds it. Would be worth a lot more right now for sure.
Yes to the idea. No to the words. If you could care less, then you care. What you mean is "I could not care less."
No charge for this complimentary service. It is the pleasure of Grama Nadzee Inc.
At 108 AAPL has fallen from its 52 week high. That must be pleasing the money managers quite a bit. Too bad the dip isn't going to last very long. Too bad for them, that is. Too good for me/us.
Most money managers bungled stock picks in 2014, missing out on huge gains
Fixed that for you. The truth is that actively managed funds are trailing indexes by a large margin in the last few years. Letting it ride on a large basket lowered your risk and broadened the exposure to gains in this continued bull market. They probably would have done much better by betting all on AAPL, of course, but no one can make predictions especially about the future!
The bigger problem is what is happening right now. AAPL should still be going up but the market won't let. Between end of year positioning to the drop in oil, everyone has a reason for why AAPL is dropping but the biggest reason is that Wall Street hates Apple and they want to punish them, at least when they don't have any holdings with them.
Fucking idiot.
Here's some free advice, dump your financial advisor. ;-)
I think amateurs will take more "risk" on a stock.
Not necessarily. A blindfolded monkey could have made 13.5% just buying an S&P 500 index last year (11.6% capital gain + 1.9% dividend yield).
What proportion of active money managers do you think beat that number?
Bloomberg floating a positive story about Apple? I guess these scumbags are worried the stock is oversold now.
Wall Street doesn't hate AAPL as much as it once did because Tim Cook started playing nice. The buyback and stock split were big catalysts long before iPhone 6 and Apple Pay saw the light of day.
Hate doesn't factor into any decisions. W$ investors are solely about making a profit.
Hate doesn't factor into any decisions. W$ investors are solely about making a profit.
I beg to differ but if AAPL doesn't play ball with W$, like the special dividend it didn't offer in 2012 that most companies did offer, or like the buybacks and the dividend increases at the behest of Carl Icahn AAPL proffered in 2014, W$ will cut you off at the knees -- exactly like it did in to AAPL in 2013. W$ hated AAPL until Tim Cook stopped acting like Steve Jobs and began following Carl Ichan's advice.
That's because money managers don't really have enough intellectual resources (nobody does) to do real due diligence on all the stocks they invest in. So they rely on rule of thumbs mostly based on reversion to the mean. "It can't rise or fall that far that long, must be due for a correction." Thus they all convinced themselves and each other that Apple was artificially high and due for a fall. And yes their self-fulfilling prophesy would hold for a while as they bail on the stock, but it can't defy the actual market and financial performance that long. THERE REALLY WAS NO REASON, OTHER THAN FEAR OF ONE'S OWN SHADOW, FOR ANYONE TO CONCLUDE THAT APPLE STOCK WAS DUE FOR A FALL. I am saying it in all caps because that's how strongly I feel about it. Meanwhile, let us all frolic in schadenfreude heaven.
Yup. Count my financial advisor as one of them. Kept "advising" me to dump all the stock @ $400.
Fucking idiot.
Any regular reader of this and similar Apple-oriented sites would know more about Apple's products, plans, prospects and performance than he does. Ask him if he even reads the useless individual company reports that his company's head office flacks churn out.
Meanwhile, let us all frolic in schadenfreude heaven.
That tickled my funny bone!