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Apple Stock Has Lost Over 5 Years Of Dividend Gains Since Announcement
To all Dividend funds who bought AAPL on hope the Dividend would lead them to untold future riches and a perpetual stream of cash we have some bad news: since the March dividend announcement (of $2.65/qtr) you have already forfeited 5.66 years of dividend payments in the form of capital losses. Because what so many forget is that stock dividends also have another side: capital gains. Or in this case losses.
AAPL is nearing its worst three-week drop in over three years as it lost the $555 pre-earnings yesterday and continues to eat away at all those potential dividend gains...
There is a reason why 'some' prefer to hold bonds with their measly yields - especially when you consider drawdown risk and volatility - but of course the easy math of a Dividend yield - TSY is so much easier to pitch to a yield hungry (and risk ignorant) audience...
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Bubbles tend to unwind in the same way and in the same timeframe that they were created.
Not even close. Bubbles usually take the stairway on the way up and the window on the way down.
drizzle for ur shizzle.
my nizzle.
werd to da sharizzle.
Snoop Dog is touring right now, he's making a stop near me soon.
bubbles "break wind in your general direction" poof.
I would beg to differ. I can show you many charts to substantiate this. Such as the stock market bubble that burst in 1929:
http://www.paradigmbook.com/assets/DowHistory1920to1931.jpg
or the .com bubble in 1999:
http://en.wikipedia.org/wiki/File:Nasdaq2.png
They downhill slope is similar in time and price to the uphil one.
Der, the 1929 graph has two slopes up and both are smaller than the slope down. Thanks for proving wonder's point.
The period from 1926 to the peak took 3 years to form, the period from 1929 through 1930 took 2 year to unwind. Not the same, but close enough most people would consider it similar, and not the "window to the way down" Wonder descsribed. You also conviently don't talk about the tech bubble which is fairly symetrical.
It's important not to confuse the indexes with the stocks.
The "tech bubble" was "fairly symetrical" because from 25,000 feet up, you can't easily see that the vast majority of tech blowups were small companies that went from $10 to delisted in a few weeks. The longer-term growth that occurred explosively in OTHER companies like Intel/Exodus/Cisco overshadowed them.
If you invest in nothing but index ETFs, that'd be one thing. If you invest in individual stocks or even mutual funds, you have to be more careful.
I think my point was lost in an irrelevent side issue. My point was more that AAPL seemed obvious to me to be a bubble.
As for the tech bubble, I just picked it because it was the first one that came to mind. I could have picked any of a dozen other bubbles and shown the same thing. if you look across a good cross section of recognized bubbles there may be an initial shock that starts the decline (as in 1929), but more often than not they unwind in a similar timeframe they took to build and return to at or below the pre-decline level. This is not my idea, it's just something I ran across and upon looking into appears to be true. If you look at AAPL, prior to it's decline it's exponential rise looks very bubble like. Notice that it is now unwinding and in a way that is not dissimmalar to the ramp up. I would bet odds, based on the theory that bubbles tend to decline similarly to how they ramp up that in about 3-4 weeks it will decline below 500.
I would LOVE to know bank of isreals cost basis on AAPL.
http://www.zerohedge.com/news/how-long-until-bank-israel-has-be-bailed-o...
Maybe $0. The Mossad could have just counterfeited the USD and bought it all with the fake cash. They've been practicing for years, counterfeiting their neighbors' currencies.
Besides, it's only a capital loss if you sell. Would have been brilliant to be selling AAPL Calls to subsidize the dividend.
The real question is ... did the large funds get out before the drop?
http://www.youtube.com/watch?v=O3id-Fb8ooY
that would be like every person staying in a packed hotel leaving at the same time!
Laying up cash for the Faceplant - I sense epic fail.
The real question is ... did the large funds get out before the drop?
Oops.
now give a chart from a year ago for those that didn't buy at 644, still higher than your iDisappointed blog as well, and this is when you are supposed to buy if there are any investors left out there, remember apple crushed earnings, this is called deleveraging by the financial crooks => opportunity to buy
Just like 644 was the opportunity to buy because every analyst raised thier target to 800+?
If iphone5 sales don't break all record in the 4th quarter will you shut up for awhile? aapl permabull and zh hater.
No question is a solid operation.
Its just the momo/bubble nature of the stock that is potentially amusing. Apple will be fine at least until daddy takes away the credit card.
This is cool. If the share-price gets low enough, it'll be an appealing investment.
Easy come, even easier go.
I feel bitch slapped. For a while back in the glory time, I was jealous of those at 600 with 1000 in sight.
Now I am not feeling so bad.
It is not good to revel or gloat over losses. We have all been burned at one time or another playing imaginary paper.
Where's all the AAPL bulls? According to one not so long ago Zerohedge had become a contrarian trade.
I confess...and this is hard for me to do...that I, Cdad, bought some AAPL today...along with adding in silver during that late plunge, while staying short a mega cap tech company that has been heretofore too retarded to correct.
Lord have mercy on my soul.
Not to bad of a trade to buy aapl today. No doubt facebook ipo trade will be on and Nasdappl will rise tomorrow and fri.
I confess that I too did a small AAPL trade today -- the JUN 600 calls @ 3:30 pm -- but at least had the decency to exit before the close. Still ... your guilt has rubbed off on me, so I'll donate the profits to charity by buying shares of RIMM tomorrow.
I was thinking RIMM is a good buy today. BB10 could rock. RIM makes a profit.
I don't want a large iPhone so I might go for an iPhone 4S instead of waiting for 5.
Next stop 425.
We had a fund wholesaler in for lunch yesterday and he was pushing dividend funds. He was all proud of the fact that their fund had Apple and they had just initiated a dividend. He didn't look to pleased when I aked how many years of dividends have been knocked off of Apple's share price.. In retrospect I probably shouldn't have said anything. I may have jeporized a future free lunch.
but, but ....wasn't AAPL going to $1000, or higher? I mean didn't Cramer say that? hehehhe
Yes. Dow 30,000, too.
http://www.wired.com/wired/archive/7.09/zeros.html
Bit off topic...but just have to comment.
Funny how today all the recent IPOs (at least the rubbish ones) are all doing very well. GRPN, P, LNKD, GM, etc....just in advance of Facebooks IPO.
Nah - these markets (muppets) are NOT managed. We are a proud capitalist system where all markets are free and unicorns frolic in fields of pretty flowers.
Parabola stocks always break. Always. But AAPL may have 1 more leg up before reality sets in. Love their products though. 0
Wasn't a big fan of this other form of Wall Street bailout actually. If you're a growth stock "it's better to stick a shovel in the ground with Mayor Villagorosa." in other words "growth means a team" and not giving away money to people who really don't care about your business to begin with. Having said that "short away" sheeple. I see a ten for one stock split coming once the Face-Hugger IPO sucks the life out of half the planet.
Bring Reggie NOW!!!!!!!!!!!!!!! His Dream May come true
iPads sales have slowed in Greece.
You get paid to wait.
"And it only takes five bucks to dig those shares out of the ground"...................................altered, adapted quote from some robo trolling mo fo tmosley used to duel with in metals posts.
yep...think it was the MEthMan that drove a fancy red car. Where have the comedians gone?
Thanks, Tyler, for covering one of my real investment pet peeves: the idea that dividend yield on a stock is a bogus concept. As Tyler mentions, the issue of risk is crucial. But there's something even more basic. When you receive a dividend on a stock, there is no increase in your wealth. You are just getting your own money back...and then paying taxes on it!
Today I have a stock position worth $10,000. If the stock pays me a $100 dividend, the next day my stock gets marked down to $9900, and I have $100 in cash. No increase in wealth. But now I owe taxes on the dividend! And that rate is scheduled to skyrocket at the end of this year.
I understand why investors don't want companies hoarding enough cash to run medium size countries. Encourage them to find a more productive use of funds. But pitching stocks based on their dividends putting a floor under them is silly. Yet I see it all day long from lots of otherwise seemingly knowledgeable pros. If you need a little income periodically then sell off a few shares. Your tax bill will likely be much lower, or non-existent if you have no gains. In an era of near-zero commissions that makes a lot more sense than paying taxes on phantom "gains."
So...
What happens if you take your $100 and buy some more shares are the now lower price of $9900? And repeat that for 20 years? The shares are worth nothing at the end?
WOW and to think for all these years that there is no effective difference in collecting a dividend or merely selling stock to pay myself a dividend.
I'm still not clear exactly what the difference happens to be, somehow the dividend is not being generated from profits or wealth creation but instead from phantom profits because they are only paying me my investment back and even after it is paid off 100% the dividends keep coming, well it is so fucking confusing.
While somehow they are creating real wealth in the appreciation of the stock price,
and although my stock ownership is exactly that and one could make the case selling it is doing nothing but paying me back my investment, can't sell more than I own and collect a dividend or pay myself a dividend by selling more shares than I originally bought. Somehow these are the real profits and not the phantom ones.
There is no distinction. None, absolute zero.
Not hard to believe such tripe exists though afterall Krugman posted a stock price is nothing more than the NPV of the dividends as if periodically selling stock is not paying oneself a dividend. So although this is simple beyond belief not even including the idea of generating income or wealth that is offset against losses to the point of being tax free but somehow is still generated wealth or income-it all can be so incredibly confusing.
Not that it matters of course but the original post trying to draw a distinction in losses between the two is the usual hysterical material. Yea run for the exits if you bought at the peak you lost dividends that were paid before you arrived. and NO, I read it once briefly. regardless it is nonsensical. Has no bearing on anything whether they paid dividends, how much they happened to be or anything else. Nothing changes, the stock price changes obviously to reflect that withdrawal- they moved cash from their balance sheet to their stock holders BFD. Has nothing to do with the price of rice in China with rates at nothing, if they hadn't paid it the stock price would have reflected the difference and your little pic wouldn't look like every other asset class of late absent blatant government manipulation or- in decline.
I tried several times to come up with a concise response that should clarify some of your errors there, but they kept multiplying as I tried to keep it short, so I'll just say this:
If you take seriously the recommendations of "seemingly knowledgeable pros" who try to sell you stocks, you're kind of a sucker.
No word of this at all on other sites. All I keep reading is the gold bubble has popped
This just in: BUY AAPL NOW!!!
Silicon Valley Restaurants Have Added iPads to Their Menus
Seared, poached or blackened...try all three.
Funny how those who said "holding AAPL is better than holding cash" sounded sane at the time.
Maybe Steve Jobs was right. Looks like they are trying to pull the Stock down to a 5% dividend yield. Then the stock will flatline for years. Like Wal Mart or GE.
I'm just going to make the observation that this blog recommended the purchase of gold many times and it has since had the shit kicked out of it.
I'm not knocking the case for investing in gold, I'm just saying that a couple weeks of consolidation in the price of an asset (be it gold or AAPL) should not call into question soundness of the investment strategy.
If you did nothing but sell everytime something you owns goes down 10% you would never do anything but sell on a loss.
Don't worry, AAPL will have another quarterly report before too long. And gold will have it's next easing related rampfest. I am quite sure of both.
Opps
yeah-why all this gloating over others misfortune?