How Are The Shorts Trading Apple Inc. (AAPL)?

If you’re an Apple Inc. (NASDAQ:AAPL) investor, should you care about short data?

In the financial blogosphere, there are tons of indicators for Apple traders to track, but it’s key to take note of a stock’s short sellers. Some indicators we can use are: (a) the percentage of a stock’s tradable shares that the shorts are presently short selling, plus (b) the change in short interest.

Increased short selling usually indicates what it implies: the market’s big players have turned less optimistic about the stock. Overselling, though, may have a positive effect on share price, as the shorts can be forced to buy their positions.

Within our database, it is not a secret that we monitor the smart money’s sentiment, but it is eqaully as beneficial to combine this information with overall short information. In certain instances, big time players could share that they’re bearish on a company, but it’s not an SEC requirement. Nevertheless, some retail players may wish to stay away from heavily shorted companies with above-average hedgie interest, while others may prefer short-squeeze opportunities. For readers looking for a market-beating piggybacking strategy, discover the details of our premium strategy.

Let us take a look at the recent info swirling around Apple Inc. (NASDAQ:AAPL).

Looking at the latest FINRA data, which is reported twice monthly, we can discover that Apple has a short interest of 2.20% of float. This indicates a -19% change from the prior filing period. With a total float of 908.12M shares, this reveals a short ratio of 2.00.

It’s also important to take note of hedge fund holdings from their 13F forms. Of the funds we track, Ken Griffin’s Citadel Investment Group had the largest call position in Apple Inc. (NASDAQ:AAPL), worth close to $1.9421 billion, accounting for 3.4% of its total 13F portfolio. The 2nd biggest stake is held by D E Shaw, managed by D. E. Shaw, which held a $1.4017 billion position; the fund has 2.6% of its 13F portfolio invested in the stock. Some other peers with similar optimism include David Einhorn’s Greenlight Capital, Philippe Laffont’s Coatue Management and Ken Fisher’s Fisher Asset Management.

Also, insider trading activity, especially when it’s bullish, is most useful when the company in focus has experienced transactions within the past 180 days. Over the last half-year time period, Apple Inc. (NASDAQ:AAPL) has seen zero unique insiders purchasing, and 7 insider sales (see the details of insider trades here).

Let’s also examine activity in other stocks similar to Apple Inc. (NASDAQ:AAPL). These stocks are Hewlett-Packard Company (NYSE:HPQ), Google Inc (NASDAQ:GOOG), International Business Machines Corp. (NYSE:IBM), Microsoft Corporation (NASDAQ:MSFT), and Dell Inc. (NASDAQ:DELL). All of these stocks are in the personal computers industry and their market caps are similar to AAPL’s market cap.

The aforementioned indicators–short interest data, hedge fund sentiment and insider trading history–are something every reader should account for. Although it is difficult to find a practical strategy from short selling data, hedgie and insider sentiment give plenty of market beating opportunities if you know where to look.