Apple’s stock is down as much as 4.25 per cent this morning.Why? Street Insider is speculating that “clearing firms are raising the margin requirement for clients,” and this is causing Apple’s stock to nosedive.
A higher margin requirement means investors need to either put up more of their own money to buy Apple stock, or just sell what they have so they don’t have to put in more cash. Margin requirement increases generally happen when a stock becomes volatile. For a long time Apple was a rocketship. Now it’s not, so a change in margin requirements makes sense.
However, this seems like a very flimsy reason for the stock to be falling.
We’d like to think that Apple’s stock is falling for more fundamental reasons. Like, investors don’t believe it has any world changing products coming. Or, investors believe Apple’s margins are going to get crushed. Or, they think Apple’s iPhone business has peaked and it’s time to get out of the stock now.
The funny thing about the stock falling is that analysts are getting more and more bullish on this quarter’s iPhone sales. Apple is meeting demand for iPhone 5s now. And there are analysts calling for over 46 million units sold.
Apple’s stock has been falling since September when it cracked $700. On a year over year basis, the stock is still up nicely.