Apple's shares swallow biggest loss in four years

[Morganfleeman]

12. It's that and

a few other factors. Short selling interest is at multi-year highs which will weigh on the stock. It's also the most widely held stock by hedge funds. Many of these hedge funds need to lock in year-end gains in AAPL to make up for losses in other parts of their portfolio. They also don't want to be the last fund holding the bag if everyone is selling. I.e., you have very large institutions heading for the exits all at once, institutions that often are required to deliver very high rates of return to their investors.


There is also the fact that AAPL has turned into a big momentum stock with increasing volatility in the past few months. Moves to the upside and downside have been much large recently.

And to boot, many funds are trading AAPL with leverage. These wild moves lead to margin calls which lead to forced liquidations.