Why We Bought Apple Options?
A few weeks ago Patrick and I were talking about the iPhone. I explained that I thought there were two possible scenarios for the iPhone:
1: it would be a disappointment and the stock would return to its $80 pre iPhone value.
2: it would be everything we hoped for and more…
If the iPhone wouldn’t disappoint, I told Patrick, it would mean that Apple would suddenly be 50% more valuable. Before the iPhone they did two things: Build computers and iPods. If the iPhone would be successful they would add a third pillar to these two pillars.
Patrick smiled and said:
‘You should put your money where your mouth is and buy some options’
And so we did. Tessa decided to join us and invested the same amount of money and Patrick and I did: €250. I didn’t want to put too much money where my mouth was.
My theory was that within 3 months Apple’s stock would go up to no less than $180. The day we bought our options Apple shares were trading at $122.
One more thing about my ability to make predictions about trading: in 1999 I owned hundreds of thousands of shares in Fortunecity.com. They were trading at €19 and I was pretty sure that they would go to €40 within 2 years.
And they ended going to 40 within 2 years.
40 eurocents to be exact.
One word of advice: don’t take any advice from me!
Reminds me of your V3 story, although I do respect that you did put your money where your mouth is!
Can’t blame you… Your theory sounds wise and who would have thought that Apple’s volume would be 32,401,700 last week!