Apple Inc. (AAPL) Is An Attractive Safe Investment

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January 6, 2015 3:33pm NASDAQ:QQQ

apple buzzFor the four-and-a-half trading days from Tuesday, Dec. 30, 2014, through mid-day Tuesday, Jan. 6, 2015, Apple Inc. (NASDAQ:AAPL) sank 7.79 percent. Apple’s fall followed the downward path of the overall market, but its descent was steeper


than the Dow, which dropped 3.79 percent, and NASDAQ, which dropped 4.36 percent.

There was no specific piece of bad news that could be blamed for AAPL’s fall. It may have been profit taking, as AAPL had gone up more than 35 percent in 2014. Meanwhile, there is reason for optimism, as several events are coming up that could potentially give AAPL a boost.

Quarterly Results Will Be Reported Jan. 27

Apple is likely to report a blow-out quarter because of fantastic sales of the iPhone 6 and iPhone 6 Plus over the holidays and over the quarter as a whole. Business Insider calls it a “monster quarter,” and Fortune says, “this should be Apple’s fattest quarter ever.” Although expectations are already high, good news could push AAPL’s stock price up.

AAPL is an Attractive Safe Investment

If the world-wide markets continue to reel under plunging oil prices, investors will seek safety — and that could mean investing in big U.S. tech companies. An influential analyst at Union Square Ventures said that “[s]afety used to mean gold, U.S. treasuries, and blue-chip stocks. Now it means Google (NASDAQ: GOOG), Apple, Amazon (NASDAQ: AMZN), and Facebook (NASDAQ: FB).”

Analyst Thinks Apple Watch Sales Will Disappoint

The same analyst who thought that Apple will benefit this year from international investors seeking safety also thought that the Apple Watch won’t live up to its hype and that the “Apple Watch will not be the home-run product that iPod, iPhone, and iPad have been.” He added, “Not everyone will want to wear a computer on their wrist.”

Apple Watch Could Boost Usage of Apple Pay

While analysts debate whether or not the Apple Watch will be popular, there is another angle to consider. A selling point for Apple Watches is that they can be conveniently used for Apple Pay. Apple Pay is already a success right out of the starting gate, and the debut of the Watch could accelerate that trend, even if the Watch is not a “home-run product.” It wouldn’t need to be.

Unlocked iPhone 6 and 6 Plus Now Available in the U.S.

Apple starting selling the unlocked phones on Tuesday, Jan. 6, which let U.S. consumers use their phones on any supported networks.

Flexible iPhones and Smart Apple Glasses May Be in Our Future

This week, Apple was granted a patent for flexible phones — including bendable screens, batteries, and circuit boards — that would be better able to withstand being dropped than regular rigid phones. Apple also received a patent for a wearable device similar to Google Glass.

SPDR S&P 500 ETF — SPY

ETFs that track broad market indexes are excellent vehicles for gaining both exposure to AAPL and increased portfolio diversity. SPY, for example, tracks the S&P 500 index and has 3.49 percent of its holdings in AAPL.

By Diana Primavera, ETF Daily News


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