Apple share price. Revision, July 2010

Two months ago we presented a model and made a conservative prediction on AAPL share price. The model for AAPL(t), as introduced in [1], was as following

AAPL(t)= 19.03HFO(t-13) - 10.13HOS(t) + 73.86(t-1990) – 1862.5

where the index of housing furnishing and operations (HFO) leads AAPL(t) by 13 months. The index of housekeeping supplies (HOS) is synchronized with the price.

We also suggested that the price would be not growing at the same pace as in the beginning of 2010. Conditional on the decline in HOS, which was expected in April-July 2010, the share price might decline since May 2010. Figure 1 demonstrates that the actual price has been decreasing since May and this behaviour was well described by the model. One might expect that AAPL share will be falling together with S&P 500 into 2011.

Figure 1. Observed and predicted AAPL share prices.

References

Kitov, I. (2010). Deterministic mechanics of pricing. Saarbrucken, Germany, LAP Lambert Academic Publishing.