You Own More Apple Stock Than We Think

The death of Apple(AAPL) co-founder as well as former Chief Executive Officer Steve Jobs on Wednesday can have jostled many investors into checking on how many Apple shares they actually have.

Some will be amazed regarding how many they hold, given the tech firm's ubiquity as a top holding in mutual money, pension funds as well as index money. That popularity should prompt them to reassess their have portfolio's diversity, since a focus in one stock, or one industry, can add to volatility as well as reduce returns.

That's definitely not to say Apple investors have not been richly rewarded by their loyalty to the revolutionary maker of iPods, iPads and iPhones. The company's shares have a 10-year average yearly return of a staggering 47% versus the S&P 500's 2.6% return. This year, Apple's shares are up 17% compared with the S&P 500's 7.6% decline.

Tom Roseen, head of research services for fund-research fast Lipper, said "a lot of people can have become complacent in keeping up with their yearly reports" from fund providers and investment advisers. They can definitely not have realized portfolio weightings shifted over time. Therefore, a reshuffling may be in order.

Apple, now selling for almost $380 a share, bringing the total market value to a dizzying $350 billion, is 2nd just to Exxon Mobil(XOM) in the S&P 500 Index, creating it a top-10 holding in most passively managed index money as well as actively managed large-cap mutual money.

A total of 26% of U.S. and international equity mutual money have Apple in their top 10 holdings, according to Standard & Poor's mutual fund industry analyst Todd Rosenbulth. Peruse any kind of fund report as well as you're probably to see "AAPL" as a holding. It's the 1 no-brainer stock for mutual fund managers to have.

The company's ubiquity is due, in part, to the goals of the fund as well as investors' timing. For example, at some point Apple was viewed as a growth stock, and so that category of fund loaded up on it. Whenever its shares fell, it may have been viewed as a value stock, so got picked up by value fund managers. And its large-cap size makes it a part of any so-called core mutual fund or index fund. But few managers ever sold Apple when it entered their portfolios as well as juiced returns like no other.


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