It's somewhat amusing to see Apple throw away market leadership now, just like it did in the 80s

[Asher]

I also recall GS predicting $200/barrel of west Texas crude by the end of 2008. It ended up at ~$45.

[Al B. Sure!]

I also recall GS predicting $200/barrel of west Texas crude by the end of 2008. It ended up at ~$45.

It's a crapshoot but would you do better? What methods do you employ?

I think Kuci would say that taken as a whole, in the long-term, Goldman Sachs is more right than wrong which is why they make money.

[Asher]

I know at my dad's oil company, they laughed at everyone who predicted $200 crude. Their operating models assumed ~$100.

And we're talking about different things. I'm talking about GS' predictions about a certain market, not things like stock performance (which they may very well be quite good at). Stock performance,especially in the case of companies like AAPLs, seldom follow any rationality.

Virtually every tech market prediction I've seen from GS has been laughable. Maybe it's just not their forte. They seem to put kids right out of school out as "analysts", where they proceed to pull numbers out of their ass.

[Asher]

nm

[Hauldren Collider]

You mean they AREN'T ALWAYS RIGHT? That must mean they aren't clairvoyant! Hacks, all of them.

[Hauldren Collider]

A put/call ratio greater than 1 means that the open interest in puts exceeds calls (here, on contracts with less than 3 months til expiry). Note that generally, there are more calls than puts bought so 1 does not usually mean a 'neutral' reading (so a put/call ratio of 1 is pessimistic).

Judging from that, the market is pessimistic with regards to AAPL and has been over the past 3 months.

A 3 month timescale for a stock is like roulette and you can't get much meaningful data out of it.

(If I understand correctly)

[Al B. Sure!]

Virtually every tech market prediction I've seen from GS has been laughable. Maybe it's just not their forte. They seem to put kids right out of school out as "analysts", where they proceed to pull numbers out of their ass.

I can't speak about how things are in the financial industry but there is a distinct lack of I guess you would call it 'product analysis' in the financial education I received. It always came secondary to the acid tests, collection ratios, book values, and all other manner of tools with respect to fundamental analysis.

I remember writing an industry outlook on the mp3 player industry but the focus of that was less on the technical aspects of the mp3 players and more on statements, sales projections, etc.

An intimate knowledge of the industries and their products definitely would help but that is difficult for a Wall Street firm to possess since they would require as much knowledge as the participants in those industries without actually being a firm in the industry.

I don't know. Maybe they're better than that, though, but it does seem difficult.

[-Jrabbit]

IMHO, Steve Jobs' health has far more effect on the price of AAPL than any other single factor.

[Kuciwalker]

A 3 month timescale for a stock is like roulette and you can't get much meaningful data out of it.

(If I understand correctly)

You don't know what you are talking about.

[Kuciwalker]

I know at my dad's oil company, they laughed at everyone who predicted $200 crude. Their operating models assumed ~$100.

And we're talking about different things. I'm talking about GS' predictions about a certain market, not things like stock performance (which they may very well be quite good at). Stock performance,especially in the case of companies like AAPLs, seldom follow any rationality.

Virtually every tech market prediction I've seen from GS has been laughable. Maybe it's just not their forte. They seem to put kids right out of school out as "analysts", where they proceed to pull numbers out of their ass.

Why would you pay attention to the predictions they publish?

[Kuciwalker]

For that matter, you seem to completely misunderstand the point. You shouldn't be listening to any person. You should be looking at the asset prices themselves as your best estimate of the value of the discounted future cash flows.

[Al B. Sure!]

A 3 month timescale for a stock is like roulette and you can't get much meaningful data out of it.

(If I understand correctly)

That depends, HC, on what you are trying to find out. I was limited by the data provided but 3 months seemed fine to get a grip on current market sentiment.

Remember, this data showed daily put/call ratios on contracts with less than 3 months til expiry over a 3 month period. There is no long-term view here, nor was I making any judgments about long-term market sentiment. Just pointing out that there is at least one indication that the market has been relatively bearish with respect to AAPL over a recent time-scale.

Maybe looking at the put/call ratios of Jan 2012 contracts might give some 'long-term view' but there's not enough volume there to warrant any judgments. Similarly, extending the time scale over 6 or 12 months may put too much weight on long-dead trends.

Also, I can't really speak on the efficacy of put/call ratios as a technical tool. There has been some research (see below) indicating that put/call ratios can be used as a predictive tool to a limited extent. Also note the time-frame (1 week).

Abstract for "The Information in Option Volume for Future Stock Prices"

You can google the title of the paper and find it in .pdf form easily if you want to learn more (disclaimer, I have only read the abstract).

[Kuciwalker]

AS appears to be doing it right

[Asher]

Why would you pay attention to the predictions they publish?

I don't pay attention to them, I see them in newspapers and the like and have a chuckle.

[Asher]

For that matter, you seem to completely misunderstand the point. You shouldn't be listening to any person. You should be looking at the asset prices themselves as your best estimate of the value of the discounted future cash flows.

What exactly do you think I was doing?

I was calling the analysts idiots and laid out my case for why it's overvalued.