Is Warren Buffet About To Sell His Stake In Apple?

Apple Inc AAPL stock has been sliding, down 11% on the year and hitting the lowest point in 4 months. The tech giant is struggling as the S&P 500 is up nearly 7% in the same time period. 

Why?

The most recent move down, close to 3% on the day, came after dismal numbers were reported out of China. The phone maker's iPhone sales dropped by 24% year-over-year in the country as people turned toward local alternatives like Huawei. 

This was just a day after regulators in the European Union fined Apple $2 billion for violating EU antitrust rules with its App Store policies. The stock tumbled 2.5% on that news.

And recently the company announced the shuttering of its electric car program. The $10 billion, 10-year effort came to a halt after the top Apple brass decided it was no longer feasible to pull off.

But probably the biggest drain on the company's stock has been its lack of participation in the AI boom. Apple has been quiet on this front with many believing the company is behind the curve.

Buffet's Move

Berkshire Hathaway BRK owns a massive stake in Apple, nearly 1 billion shares, or 6% of the company. Buffet initiated his stake in the company in 2016 when the shares were trading at about $22 and finished amassing his stake buy 2018 when the shares were still south of $50. He's enjoyed an enormous ROI and now may be the time to make an exit.

How to make an exit will be tricky. Berkshire must report its holdings on the 13F form. If the next one, due in May, shows Buffett offloading Apple, it could start a chain reaction as many in the investment world pay close attention to Buffet's every move.

Bulls And Bears

For traders who believe in the bear case and wish to profit off of a drop in APPL, inverse ETFs can be an excellent option, ETFs like those offered by Direxion. The innovative fund manager offers two plays on APPL, one for bulls and one for bears.

The Direxion Daily AAPL Bear 1X Shares AAPU seeks daily investment results, before fees and expenses, of 100% of the inverse (or opposite) of the daily performance of Apple Inc.

The Direxion Daily AAPL Bull 1.5X Shares AAPD seeks daily investment results, before fees and expenses, of 150% of the daily performance of the common stock of Apple Inc AAPL.

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