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Apple: Seven Reasons Shorts Love It

Jason Schwarz is the author of The Apple Revolution, an e-book.

NEW YORK ( TheStreet) -- A common sense interpretation of Apple (AAPL - Get Report) fundamentals leads most investors to conclude that this stock should go straight up. Mac sales were up 74% in October and November, the iPhone is on track to have its first quarter of unit sales of 10 million, the iPod Touch continues to gain market share among gamers, the Tablet will be released in 2010. But for some reason, the stock sits dormant in December; if only investing were so easy.

Common sense wins in the long run, but the short run can be dominated by sophisticated trading strategies that test your conviction. Apple happens to be the investment vehicle of choice, not only for the longs but the shorts as well. For many of the same reasons you love Apple stock, the shorts do, too.

Here are seven reasons why investors love to short Apple.

1. Apple is the market leader.


I don't mean Apple is the leader of the PC market or the smartphone market; I'm talking about the stock market. The Dow Jones Industrial Average would have hit 11,000 by now if Apple were having a strong December.

This one stock has become so important to the market that its action is contagious. This influence makes Apple a prized possession for both the longs and the shorts. Knocking down an easier target like Research In Motion (RIMM) or Citigroup (C - Get Report) doesn't generate the same snowball effect. This begs the question: Why would anybody want to keep a strong stock and a strong market down? That leads to No. 2.

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