Putting the Apple Sell-off in Context

The financial world has been gripped by the recent sell-off in shares of Apple ($AAPL). Apparently Isaac Newton was correct; apples do obey the laws of gravity.

At one point on September 21st, the stock got to $705 per share, and it hit a recent low of $505 on November. That’s $200 in less than two months. That’s a loss of roughly $188 billion, which is more than $625 per every American. Ouch!

While the numbers are staggering in nominal terms, in percentage terms, it’s not that big of a deal for any one stock — and particularly not for Apple. Here’s a logarithmic chart of Apple going back to 1985. As you can see, the recent downturn is peanuts compared with other Apple plunges.

Between March 22, 2000 and April 17, 2003, Apple dropped 82%. If it were to do the same this time, the stock would be at $128 per share in late 2015.

I’m not saying it will. I’m just saying it has.

Posted by on December 10th, 2012 at 12:59 pm

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