“Renaissance Technologies, the biggest quantitative hedge fund in the world, made more than 500 new purchases in the second quarter,” Robert Holmes reports for TheStreet. “But none was as important as fund managers’ decision to double its stake in Apple.”
“Renaissance Technologies’ Web site promises “superior returns” for its clients and employees by adhering to mathematical and statistical methods,” Holmes reports. “Several reports say that about half of the hedge fund’s 275 employees hold doctoral degrees. The fund was started by Jim Simons nearly three decades ago and uses computer-based models to analyze and automate trades.”
Holmes reports, “Apple became the fund’s largest holding as of June 30, according to the latest 13F filing with regulators. RenTec, as Renaissance Technologies is known, picked up 763,000 shares of Apple, more than doubling its position to 1.3 million shares with a market value of $445 million.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “David E.” for the heads up.]
I wish I could say, I understand the short term/long term implications.
You just did.
😉
They could put more volatility in Apple shares by trying to constantly make nickels and dimes of profit per share per day on that many shares.
Or would they stabilize Apple trying to protect it’s value.
I used my mathematical and statistical model and decided to buy 3000 shares of Apple since Feb of 2007. 😉 I have a couple Opinion pieces written here on MDN, that appeared in March and October of 2008, recommending that others consider buying as well, but sadly, those have disappeared when MDN updated their website. Why MDN, why?
Start up a blog and post it. I’d read it! You always post good financial opines.
This is a safe bet. Apple is a very well managed company and AAPL is a very well managed stock with a P/E this is half of what it was before the introduction of the iPhone. That means this stock has been excessively “pruned” over the last 5 years and is still outperforming the market delivering 40 -50% returns a year. Versus the DOW over the last 5 years, AAPL has grown 500% to 1.5% for the DOW.
With a very small percentage of the computer market and owning the nascent fast growing tablet market, Apple has much headroom to grow. As tablets and laptop computers merge, Apple will go from 5% to 25%+, possibly even as high as 70% of the global computer market, plus the value add of Apple’s ingenuity and design beats the commoditized business model of the competition in terms of profitability, so with the huge headroom, there is still room to grow at the same rate over the next 10 years.
dd: I ought to tell you to calm down, but I don’t want to.
I’m always concerned about hedge funds causing too much volatility and they’ll also try to nickel and dime the stock on a daily basis. Too many shares in the hands of one institute is just too dangerous especially if the fund manager gets dissatisfied about how Apple is running the company. Any bad news and they’ll probably start panic selling due to automatic trading to drive the stock down in the blink of an eye.
I just wish I knew why Apple’s multiple keeps getting squeezed if it’s supposed to be such a great stock and continues to make more money quarter after quarter.
“half of the hedge fund’s 275 employees hold doctoral degrees”. Are they real doctorates or just American “doctoral degrees”?
And do 275 employees really make “the biggest quantitative hedge fund in the world”? With a name like Renaissance, let’s hope they don’t bump into Renaissance Group, one of the world’s largest merchant banks. Founded by expatriate New Zealander Stephen Jennings, headquartered in Moscow, with a global reach and many thousands of employees. Jennings came close to losing $6 billion of his personal fortune in the 2008 financial disaster. He sold half of the company to Mikhail Prokhorov who, after selling back to Jennings, decided to take on the Kremlin. Watch for rumbles as he seeks to depose Putin.
You don’t need a doctorate to know that AAPL is a money machine. Here’s hoping that the market dips this week so the shares become even more enticing. Buy soon before the ramp up gets underway. AAPL should rise until the end of the year once it gets going. and when the next earnings arrives be ready with some sweet calls. Don’t miss the boat. Be long AAPL.
just a blast from the past… provided by Daring Fireball.
A Taste From the Claim Chowder Hall of Fame ★
John C. Dvorak, in March 2007, “Apple Should Pull the Plug on the iPhone:
The problem here is that while Apple can play the fashion game as well as any company, there is no evidence that it can play it fast enough. These phones go in and out of style so fast that unless Apple has half a dozen variants in the pipeline, its phone, even if immediately successful, will be passé within 3 months.
There is no likelihood that Apple can be successful in a business this competitive.
Meanwhile, today, the best-selling and most-profitable phone in the world is the 14-month-old iPhone 4.
Some humor for a monday.
🙂