Events often drive stock prices. Earnings, resignations, scandal and economic data can move shares up or down. But hype can affect stock prices as well.
Blogger Matt Haughey decided to see how much the much-hyped announcements of Apple Inc. at Macworld each January moved the computer and software company’s shares. Haughey evaluated how much a hypothetical $10,000 investment in AAPL on the day before the announcements would return if sold the day after.
Tuesday’s announcements of an ultra-slim, ultra-light laptop along with the ability to rent movies from iTunes apparently didn’t impress traders. Apple stock slipped about 7 percent on Tuesday, and this morning was continuing to trend downward.
But Haughey’s Web site clearly demonstrates the benefits of a buy-and-hold strategy. Although the returns in each of the past two years have been remarkable, $10,000 invested in Apple in 1997 would be worth about $500,000 today.