We fail to understand this phenomenon. Search the web on the Apple tablet (presumably going to be announced on January 27, 2010), and at least half the articles will discuss how it is a competitor to the Amazon Kindle. Yesterday I watched the “Fast Money” gang on CNBC discuss the same thing.
If, as traders, we should have learnt something about Apple, is that they do not compete with any existing product in the market. They change the game. When will traders start realizing that Apple has never been a “me too” company. They have been a “top that” company. One has to be bold when predicting or forecasting what Apple is going to do. Only then will one come close to the truth.
Make no mistake about it. We are long on Apple stock as well as options. But we will sell when the bump-up from the news dies down. And we also think our expectations of AAPL stock price moving over $250 after the Tablet announcement is a reasonable expectation. And it will ave nothing to do with the Amazon Kindle.
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