AAPL is the among the first stocks purchased for BSMF. It has always been one of the largest holdings by percentage in the BSMF portfolio. It’s also one of the first stocks I bought for my personal portfolio.
Apple Computer, Inc. was the company’s name when I bought in initially. It was 1999 when I bought it for my personal account. In 1999, you had to be an idiot to buy stock in Apple. Even on tech-geek sites where they loved the products, nobody was recommending AAPL as an investment.
I don’t remember the date, but I remember the moment I decided to invest in Apple. I had been watching the stock for months. I was just learning about the stock market. I had a few shares of various companies that are long gone and forgotten, now. Apple had been on the verge of bankruptcy. I was only really interested in the company because I’ve been using their products since 1987. I bought a Macintosh SE computer, and have never owned any other brand since then.
In 1999 the stock was sitting at 62.50 per share when the company did a quarterly conference call. Profit missed analysts predictions by one cent per share. Overnight the stock price dropped by more than half. It quickly dropped to 25.00. I started reading everything I could find to figure out why the stock dropped as much as it did.
Here’s the thing. Profit had gone up quarter to quarter and compared to the same quarter the previous year. The company was making money. The company was making more money. It was selling stuff at a good clip. It missed analysts predictions by one penny and the stock price nosedived.
I went to as many places as I could find to explain to me exactly why such a report would drive stock prices down so much. I couldn’t find anything that parsed logical reasoning to give me that result. I could only surmise that it was a purely emotional response.
I bought a few shares. I still own some of those original shares. The split-adjusted price of the shares I still hold from that initial purchase is less than a dollar a share. It was over a year later that I started BSMF. AAPL has been approximately 20% of BSMF for several years.
This is one of the first lessons I learned about investing. If the mainstream is certain that something is a bad idea, it is almost certainly a good idea. And vice versa.
AAPL is maintained between 20% and 25% of the value of BSMF. Since inception it has 165% growth.