macnn
06/03/2008, 12:05pm, EDT
Tuesday, June 3rd
Piper: History favors investing before WWDC
People looking to make a short-term profit on Apple stock may want to consider buying before a company event, and selling the week after, a new Piper Jaffray analysis suggests. The group says it has researched the trading history for the past 14 major events, and determined that Apple stock tends to climb 0.4 percent between the day before an event and a week after it; if the former duration is extended to a week before, the growth becomes 4.2 percent. During the events themselves, Apple stocks slide an average of 0.7 percent.
Apple's next event is the 2008 WWDC conference, scheduled for June 9th to the 13, at the Moscone Center in San Francisco.
Piper meanwhile notes that although 3G iPhone sales are likely to draw investors during the next month, they may also be lured in by Mac sales, Apple's biggest profit engine. NPD results from April suggest that while unlikely, Mac sales may be up as much as 50 percent year-over-year, compared to a Street prediction of 22 percent. Piper nevertheless argues that the scale of Apple's increasing marketshare is "being underestimated."
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Wow
These guys are rockets scientists! When did they figure this one out??? Seriously, this is sooo not news. Considering capital gains tax on a stock is 35% if you hold it less than a year (last time I looked) you would have to make a SIZABLE investment to make this worthwhile. Holding it for a year is the better plan as it is targeted for mid to high 200's. If you bought earlier this year when it was at $120, as I did, you are in even better shape.
Capital gains
Capital gains tax only affects the profits you make on your investment. ie, if you were to invest $1000 in AAPL, watch it go up the 4.2% listed in the article, and then sell, you would only pay taxes on the $42 you made. Chances are, your transaction fees would cost more than that. Now, if you were to buy $1,000,000 worth of AAPL, you would pay capital gains tax on $42,000 - somewhere in the $14,000 range.
Shorting Macworld 2008...
... announcements a week prior might have been the call this year...
Oooh, 4%
The shares my club bought last year have doubled. I guess like Big E said, if you have enough money you can make something of 4% (or go the options route if you like to live large), but it's nothing compared to the overall performance of AAPL since '02.
Capital gains
Yes, I understand that capital gains only applies to profits. I was merely pointing out, for those not thinking about it there is a difference in your tax rate between long-term capital gains (greater than one year) and short-term (shorter than one year). If you want to 'make a quick buck,' it might not be all that worthwhile.
Re: captial gains
And that's the difference between what one might call "real" (or "it's my job") traders and the investment as a "hobby"/"make my money make more money" types. The ones who trade daily for a living are fine making small amounts of money on short-term deals, for you make it up in volume, volume, volume.
If you're investing your retirement money and don't have time to watch the market forces as they bounce around hourly (or even less), you're not going to want to buy/sell on a 'tip' that's based as much on market whims then anything else.
Technically, investors looking to make a 'big score' are those who tend to lose more than make.