‘Round Five’ with This Tech Icon and Booking an 86% Option Gain

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

We have played the ebb and flow of this week’s Alpha Algorithm pick, Apple, Inc. (AAPL), for several quick double-digit-percentage trading gains.

Although our most recent gain in the stock came on Nov. 15 with a 10.52% profit, Apple remains one of the very favorite stocks among the Alpha Algorithm strategies. No fewer than 14 market-trouncing strategies are betting on the stock. That level of conviction is close to a record.

With the stock rebounding sharply yesterday and with what I expect to be a year-end rally ahead of us, this is, yet again, a good time to re-enter.

Apple, Inc. (AAPL) of Cupertino, California, designs, manufactures and markets mobile communication and media devices, personal computers and portable digital music players to consumers, small- and mid-sized businesses and enterprise and government customers worldwide. It is the largest company in the world based on market capitalization.

Apple (AAPL) versus the S&P 500 year to date.

14 Top Investment Strategies Betting on Apple, Inc. (AAPL)

  1. High-Quality Stock

The stock exhibits positive fundamentals, including high return on equity, stable year-over-year earnings growth and low financial leverage.

  1. Fundamental Strength

This is a top U.S. stock based on fundamentals measured by book value, cash flow, sales and dividends.

  1. Momentum Model

The stock is among the top approximately 100 U.S.-listed companies to demonstrate powerful strength characteristics relative to the 3,000 largest U.S.-listed companies.

  1. Goldman Sachs’ Active Beta

The stock is selected according to four factors — value, quality, momentum and low volatility. These, in turn, are based on criteria including book value, sales and cash flow scaled by share price, profit/assets or return on equity (ROE), risk-adjusted returns and daily standard deviation of returns.

  1. Small-Cap/Value Tilt

Selected using a multi-factor modeling approach, the stock is a smaller-cap or value stock designed to enhance portfolio risk/return characteristics.

  1. Shareholder Yield

This is one of the companies on the U.S. stock market that is (a) paying cash dividends, (b) engaging in net share repurchases and (c) paying down balance sheet debt.

  1. Large-Cap Momentum

The stock is part of a major hedge fund’s systematic strategy that invests in large- and mid-cap U.S. companies with positive momentum and that rank in the top third of total return over the prior 12 months, excluding the last month.

  1. Hedge Fund Alpha

Based on publicly available disclosures, successful hedge fund managers are investing in the stock.

  1. Hedge Fund Gurus

The stock is one of the top U.S.-listed equity positions reported on Form 13F by select hedge funds with concentrated top holdings.

  1. Goldman Sachs Hedge Fund Index 

The stock is part of the Goldman Sachs Hedge Industry Index, which tracks an equal-weighted index of the 50 most-frequently held U.S. companies selected from the portfolios of hedge funds.

  1. Billionaire Bet

The stock is one of 30 U.S. companies tracked in an equal-weighted index selected from the portfolios of 10 asset managers with a personal net worth of at least $1 billion.

  1. Capital Strength

The stock is part of a strategy that seeks to outperform the market by selecting companies based on the strength of their balance sheets, long-term debt ratios and return on assets (ROA).

  1. Momentum Factor

The stock is one of the top 120 large- and mid-cap U.S. stocks exhibiting relatively higher price momentum, as measured by a specific factor which has historically driven a significant part of companies’ risk and return.

  1. Exponential Technologies

The stock is part of a strategy that invests in nine different fields deemed to be vast growth “exponential technologies”: big data and analytics, nanotechnology, medicine, networks, energy and environmental systems, robotics, 3-D printing, bioinformatics and financial services.

Exclusive  The Bear Market Might Be Over


Buy Apple, Inc. (AAPL) at market today and place you stop at $158.00.

If you want to play the options, I recommend the AAPL February $170 calls (AAPL180216C00170000), which last traded at $9.70 and expire on Feb. 16.

Portfolio Update

Raise your stop in PayPal Holdings (PYPL) to $73.20 to lock in a 35% gain.

Raise your stop in UnitedHealth Group (UNH) to $209.05 to lock in a 15% gain.

Raise your stop in The Boeing Company (BA) to $262.40 to lock in a 10% gain.

Sell half of your Home Depot (HD) February $165 calls, which last traded at $9.90 for an 86.09% gain,

You were stopped out of Microsoft Corp. (MSFT) and Berkshire Hathaway (BRK-B) last Friday for gains of 15.58% and 10.03%, respectively.


Nicholas Vardy

Nicholas A. Vardy

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