Friday Charts: More Apple Domination and Volatility’s Strange Disappearance

May 12, 2017

By Friday Charts: More Apple Domination and Volatility’s Strange Disappearance

It’s Friday in the Wall Street Daily nation. That means it’s time to embrace the adage that a picture is worth a thousand words.

This week, I’ve handpicked two charts to convey Apple’s current — and likely continued — dominance.

Then, it’s on to a handful of graphics that underscore the shocking disappearance of market volatility in a time of so much political uncertainty. Is it time for investors to rejoice or run for cover?

Let’s find out…

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Candy Apple

Corporate records are meant to be broken. Apparently, Apple wants to break them all. Repeatedly.


  • 2015: Apple reports the single highest quarterly profit in corporate history of $18 billion
  • 2016: The company tops its own profit record, reporting an $18.4 billion haul.
  • 2017: Apple reveals it has the biggest cash hoard in corporate history, at $256.8 billion. If Apple’s cash pile were its own public company, it would be the 13th largest in the world, right ahead of General Electric.

Apple cash balance over time

Of course, all along the way, these records have propelled Apple’s stock to record highs.

This year alone, Apple’s stock hit 19 new record highs (and counting). As a result, Apple’s market capitalization — you guessed it — hit a record high of $800 billion.

As you can see in the following chart, many companies made a valiant effort to reach the same heights and failed.

Historical market caps for world's biggest companies

It appears that the company is on a crash course with an unfathomable $1 trillion market capitalization now.

Can anything stop it? Chime in using the comments section with your thoughts.

If I were a betting man, though, I wouldn’t bet against Apple.

My True Alpha subscribers have been betting on Apple since December 2016.

While the stock is up 31% since then, they’re sitting on profits of over 150%. (Click here to find out how, and to start your risk-free trial to our premium advisory today.)

And while I’m convinced that Apple’s trend of hitting new highs will continue, here’s one trend I’d bet you dollars to doughnuts doesn’t last…

O Volatility, Volatility, Wherefore Art Thou, Volatility?

Wall Street’s fear index is currently plumbing near record lows.

The CBOE Volatility Index dropped to 9.77 — its lowest since 1993.

VIX volatility index over time

That’s even more remarkable considering the political volatility we’re witnessing — here and abroad. Historically, political unrest and unpredictability can spook investors. Not this time.

Not yet, at least, which brings us to this Reuters observation…

A declining VIX typically indicates a bullish outlook for stocks, but the extreme lows the index has touched are sounding caution for some stock investors.

Count Citi among them.

The firm’s Macro Risk Index recorded its sixth-consecutive monthly decline to hit an extreme low. According to Citi, “Comparable low levels of risk aversion have historically been followed by higher volatility, stronger USD, higher bond prices and weak performance of global equities.”

Macro risk index over time

The takeaway: Don’t panic. But don’t be oblivious.

Speculators should consider going long the VIX. It’s only a matter of time before volatility returns.

As for everyone else? Make sure you have trailing stops in place to protect your profits in the event of any sudden and severe market sell-offs.

Ahead of the tape,

Louis Basenese
Chief Investment Strategist, Wall Street Daily 

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