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The World's Biggest Hedge Fund Hotel Just Became The Biggest Ever - 230 Hedge Funds Own Apple As Of June 30

Tyler Durden's picture





 

Three months ago when we looked at the latest quarterly hedge fund position tracker from GS, we were not surprised to learn that a record 226 hedge funds were long AAPL stock. And as the chart below proves, a major driver of the increasing price of Apple stock is that increasingly more hedge funds continue to simply pile into the name, which in times of underperformance, such as now with just 11% of hedge funds outperforming the S&P as reported yesterday, is a short-cut means to generating modestly low-risk, high beta due to the collusive nature of all HFs rushing into the safety of one name all at the same time, that at least has some (arguably tenuous if indeed the leaked iPhone 5 photos are of the final thing) fundamentals propping the stock price. Sure enough, in the latest update, the hedge fund hotel California just got bigger once again for the 6th consecutive time, and as of June 30 a record 230 hedge funds were long the stock. We can only imagine how many more peripheral underperforming funds have joined the biggest hedge fund crowd ever since June 30 and have scrambled into the one stock that provides even a modest reprieve from the certainty of career-ending redemption requests come as soon as the September 30 redemption deadline, which is less than one short month away.

Our question at this point is what is the best name for Alpha ex-Apple?

 


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Tue, 08/21/2012 - 10:00 | Link to Comment slaughterer
slaughterer's picture

Started shorting at $673 this morning. 

Tue, 08/21/2012 - 10:23 | Link to Comment Short Memories
Short Memories's picture

Its a hedge against accidently making money, good way to lighten muppet wallets.

Wish I was in a position to short the stock!

 

Tue, 08/21/2012 - 13:00 | Link to Comment falak pema
falak pema's picture

Bob Janjuah blues... getting to you? 

BOB JANJUAH: Time For Action, Warning Over - Business Insider

moving below 658 now. That's 2.3% right there.

Tue, 08/21/2012 - 10:40 | Link to Comment CPL
CPL's picture

All eggs meet basket.

 

Single basket meet all eggs.

 

I would not short.

I would not hold.

 

There is no money to be made here anymore.  Volume is too low and HFT's are cannibalising one another.  Absolutely rediculious. to assume there is ANY business left.  Anyone that makes money and works for a living can feel the faint tug at the back of their skulls about silver, oil and gold.

 

Good luck with your short though...keep your stops in.

Tue, 08/21/2012 - 10:49 | Link to Comment slaughterer
slaughterer's picture

Thanks, AAPL is about to go red on the day.  We are lowering our stops. 

Tue, 08/21/2012 - 11:25 | Link to Comment CPL
CPL's picture

Keep your wits on yourself and watch out for lunch time.  The retail biological algo's pop on briefly and mistake a dip as a good thing.

 

If the short is steady all we are going to see is a penny fight.  where two algo's get stuck in a couple of penny difference loop forever.  With Apple it's bound to happen.  Volume is low and it's too easy to execute on one of the most expensive stocks on the planet.

 

HOWEVER the short breakdown for the next week is EXCELLENT.  Primary reason for the short position.  Capital and Credit.

 

There is no more of it.  Unless some fucker drops a couple trillion dollars or declares a global debt Jubilee, aapl cannot find increaseing price on limited and useless volume.  It's like owning the worlds coolest boat, but you haven't got a body of water larger than an inflatable pool to put it in.

Tue, 08/21/2012 - 11:50 | Link to Comment Overfed
Overfed's picture

You totally beat me to the all eggs in one basket metaphor.

Tue, 08/21/2012 - 10:02 | Link to Comment Capitalist
Capitalist's picture

Going to be sooo sweet shorting this on the way down. Remember kiddies, he who sells first, sells best.

Tue, 08/21/2012 - 10:23 | Link to Comment i-dog
i-dog's picture

Hmmmm ... that's an awful lot of hedge funds wandering dangerously close to the vacuum cleaner nozzle. Glad my money's not with any of them...it's going to [not] be fun when the 'on' switch is flipped.

Tue, 08/21/2012 - 10:02 | Link to Comment slaughterer
slaughterer's picture

The real story stock today is Deutsche Bank: up over 6% on a major VW-type short squeeze despite Laundering and Libor scares. 

Tue, 08/21/2012 - 10:02 | Link to Comment Racer
Racer's picture

Going to be one might big squeeze at the exits

Tue, 08/21/2012 - 10:03 | Link to Comment buzzsaw99
buzzsaw99's picture

GLW

Tue, 08/21/2012 - 10:03 | Link to Comment Gringo Viejo
Gringo Viejo's picture

These funds have collusively parked their money in AAPL for safe haven which is the reason for its absurd market cap. Eventually, they will collusively short it.

Tue, 08/21/2012 - 10:12 | Link to Comment LongSoupLine
LongSoupLine's picture

Quick, everyone move to the other side of the life raft at the same time!

Tue, 08/21/2012 - 10:16 | Link to Comment Mercury
Mercury's picture

Too Big To Fail.

It's only a matter of time before (another) Apple product flops and the government buys up every last one of them.

Tue, 08/21/2012 - 10:13 | Link to Comment SmoothCoolSmoke
SmoothCoolSmoke's picture

I'm a bear, but why would AAPL go down when the likes of PCLN, CMG, LULU, etc ............. soared to unimaginable heights with much less of a "proven" business thatn AAPL?

Tue, 08/21/2012 - 10:20 | Link to Comment Christoph830
Christoph830's picture

Please explain why you think CMG and LULU had "much less of a proven business" model than AAPL?  I don't see that at all.

Tue, 08/21/2012 - 10:33 | Link to Comment kridkrid
kridkrid's picture

On lulu... Someone here crunched some numbers about their retail business, and unless retail fraud is a sustainable model, lulu might be something to avoid. There is also a story out there about some channel stuffing in foreign markets... But I'm likely just believing what I want to believe, as I find the status seeking high end fashion show workout clothes market nauseating.

Tue, 08/21/2012 - 10:26 | Link to Comment kridkrid
kridkrid's picture

Each of those are 2 to 3 times more expensive than aapl... fb is still 9 times more expensive.

Tue, 08/21/2012 - 10:18 | Link to Comment slaughterer
slaughterer's picture

Why would AAPL go down? 

--No more buyers.  The biggest buyers are already in. 

--To kill off options profits.

--iPhone5/iTV disappointment.

--Because no company has ever maintained a $600b market cap for too long. 

--Chartist reasons. 

Tue, 08/21/2012 - 10:19 | Link to Comment asteroids
asteroids's picture

You need look no further to show how broken our markets are. 4 years of the FED juicing the has had unintended consequences. This is one of them. There WILL be a correction, and mother nature is a bitch.

Tue, 08/21/2012 - 12:20 | Link to Comment FeralSerf
FeralSerf's picture

When you're on the North Pole, there's only one direction to go.  Is AAPL on the North Pole?  We'll see.

Tue, 08/21/2012 - 10:21 | Link to Comment Crispy
Crispy's picture

3% of mkt cap owned by funds is nothing. They could easily ramp this fucker up to a grand, and I hope the retail crowd sells it to them to entire way....

Tue, 08/21/2012 - 10:25 | Link to Comment monopoly
monopoly's picture

Just good to be on the sidlines on this one. Use the products, don't buy the stock. Which obviously was mistake over the last few years. But not now.

Tue, 08/21/2012 - 10:25 | Link to Comment Arnold Ziffel
Arnold Ziffel's picture

When the McIntosh Bursts, it may be a bigger display of fireworks then the Chinese Housing Bubble collapse. It's a tossup.

Tue, 08/21/2012 - 10:27 | Link to Comment slaughterer
slaughterer's picture

3% is nearly $20b.  That is a massive amount for hedge funds to own. 

Tue, 08/21/2012 - 10:30 | Link to Comment Crispy
Crispy's picture

The $ amount is huge, no doubt, but as a % of the float its still peanuts. This could get really crazy as they try and play catch up into years end is all im saying.

 

I own no aapl, nor do I own any paper at all.

Tue, 08/21/2012 - 10:45 | Link to Comment covert
covert's picture

they were against apple for a long time, fair weather friends.

http://expose2.wordpress.com/2011/11/20/a-voice-from-the-dark/

Tue, 08/21/2012 - 10:33 | Link to Comment Marley
Marley's picture

Looks like a harvest moon rising.

Tue, 08/21/2012 - 10:38 | Link to Comment rosiescenario
rosiescenario's picture

Just another symptom of the diseased market...

Tue, 08/21/2012 - 10:47 | Link to Comment dolph9
dolph9's picture

I'm tired of this bullshit.  When does it end.

Tue, 08/21/2012 - 10:52 | Link to Comment NeedleDickTheBu...
NeedleDickTheBugFucker's picture

Thank god I put all of my money into hedge funds. It never would have occurred to me to buy AAPL on my own.

Tue, 08/21/2012 - 10:56 | Link to Comment slaughterer
slaughterer's picture

Notice to AAPL shareholders: SELL.  AAPL crash imminent.  Happening as we speak.  Volume/price.   

Tue, 08/21/2012 - 10:58 | Link to Comment slaughterer
slaughterer's picture

Going down....  Our hedge fund friends are taking profits at this intermediate top.   Expected to test 650 level EOW.  

Tue, 08/21/2012 - 13:11 | Link to Comment Let The Wurlitz...
Let The Wurlitzer Play's picture

If I wasnt already short casinos and retail I would short AAPL.  To many stocks to short to little money.

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