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lol comment on stock pricing

From the September MFO Commentary:

By recent count, 1020 funds and 590 ETFs own Apple stock. It’s impossible to expect exceptional gains when a thousand analysts are dissecting, and a thousand managers are bidding upon, the same stock.

I sent this assertion to one of my kids, a consultant who's been following and analyzing Apple since before his MBA days two decades ago. His quick reply:

" Ha! 'Impossible'! "


  • Not sure how to interpret your son's reply d moran...Curious if your son believes this is a growth story due to its brand strength and huge cash reserve which can buy new tech start ups or invent a new space, growth in stock price due to it being a large position in index funds due to constant 401k fund flows, a utility play steady eddy with huge eco system and installed base, safer then investing in tbills (not joking here), or just a safe haven to park a chunk of cash? Fwiw, I have no position and own no Apple products. Android and Mr softie for me....silly me!
  • I believe it was just a reaction to an assertion that is clearly wrong and has been proved wrong for decades if not longer. In other words the second sentence quoted is nuts nonsense and probably could have been written about Apple at any point in this century. The word impossible, as he notes.

    But nothing necessarily to do with Apple, his interest in the company aside.

    I was at a party recently where someone was saying he had concluded that his late father had been a "severe alcoholic" most of his adult life. A sympathetic physician asked how old the man was when he died. 91 was the answer. The doc said, "Not to quibble, but he could not be quite as you describe; such drinkers never live that long, by definition." Fortunately the discussion stayed thoughtful and did not turn into hairsplitting over degrees of alcohol-use disorder yada yada. But the general point did strike me that if your father lives to 91 you are advised to aim for care in discussing his health. Same with "It’s impossible to expect exceptional gains when ...." As Galileo possibly did not say, "Eppur si muove."
  • And to answer your specific questions, I expect he believes most of those things, meaning you have covered most of the factors. Maybe not a 'safe haven', though; to return to where I began, the last year it's swung from 124 to just under 200! It is sort of a steady Eddy, still --- with enough time. (Further giving the lie to the assertion about how its reality has been "impossible.")
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