Apple: Taking some profits without selling your shares just yet

“It feels good to be the king. Who could possibly blame someone who bought Apple (AAPL) ____ (insert any date you wish here) for feeling like they are king or queen of the world. Clearly you are smarter than the person who sold you the shares, there can be no question about it. It’s one of the human emotions that really have no equal, the euphoric feeling of money and wealth piling up endless for no more reason than you figured out how to open the golden treasure chest,” Robert Weinstein writes for Seeking Alpha.

“If emotion doesn’t dictate your buying and selling choices and you believe Apple may be nearing a top, but are not quite sure how to time it in this market you do have another choice in your exit strategy. One of the strategies I employ for my longer term exits (as well as entries) is the use of options,” Weinstein writes. “With the use of options, investors are able to exit part or all of a position without having to time the sale right down to the minute. For example, with Apple currently trading around $578 a share after the recent move higher in price you would feel comfortable selling in this current price range, but not sure because you’re thinking you might be leaving money on the table. One method of exiting a position and squeezing out a little extra income is by selling an in the money call option against some or all of your shares. Remember when entering or exiting, you generally do not have to make an ‘all or nothing’ move. Typically when I enter or exit a position I will scale in and out as I do not try to pick tops and bottoms right on the nose.”

Read more in the full article here.


    1. IF this idea is news to you, you should not follow this advice. This is actually pretty damn bad advice. A good way to have your shares called away… then what are you going to do? Buy in at a higher price ? You’ll feel terrible.

      Apple is likely to fall from here, but the market can be irrational longer than you can be solvent.

      If you don’t know why a buying a spread is better than buying an option, or buying the shares, then you should just hold the shares.

      Buy and hold is a reasonable strategy for Apple. Don’t get fancy.

      (And selling options is too fancy. I’m extremely sophisticated and I NEVER sell naked options, always hedged when I do. I wouldn’t be hedging it with my precious common because of something an idiot on the internet said either. )

    1. Bought mine back in 2003 at $7.50. I hold a core position and sell Out-of-the-Money covered calls to produce income without selling shares. I’ll be retiring this year too. Hope Apple starts paying a dividend so I don’t have to do options at all.

      1. I started buying after the first iMac, OS X, and early iPods. Bought a bunch over the next few years, a few hundred at a time. Average basis: $7.91. Started a modest selling program once it crossed $200. My wife and I quit working, started traveling, and are giving our kid the finest education. I still have the bulk of the AAPL position.

    2. Yep, there are a few of us who bought in 2007. I bought half of my current position back in Feb of 2007, and I know ChrissyOne bought her shares at the same time. I hope there are lots of us who did the same, or better. Yeah, some bought even as recently as March 2003, when Apple was $12, pre-split. I know I did, but sold those long ago.

  1. Not a very good description. Not to mention a rambling incoherent sentence that just simply sucks. But he is correct about options. I haven’t purchased shares of AAPL in a year as I have replaced shares with options. You can make so much more money while risking/investing so much less. Options can be very difficult to master but if you just stick with the basics it’s not that hard. A fair amount of studying and research will reap great rewards. AAPL is just too expensive here to purchase as an equity. Options are great! The AAPL run isn’t over yet so jump aboard and make some money.

  2. Why is it that when people post what they bought AAPL at it’s always $7.50 0r $9 ? Nobody ever says “i bought at $129”. Some of these people have to be full of shit.

  3. OK I bought at 8, at 25, at 125, at 250 , at 300, at 450, at 560, at… You get the picture. I never figured out options but I’m riding aapl to retirement anyway. Thanks, Steve.

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