This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Apple, the Twitter IPO and Emotional Investing

Stocks in this article: AAPL

NEW YORK ( TheStreet) --

That's the response I received from TheStreet's Doug Kass after he told me he didn't understand the thinking I presented in my response ( Will the Drunken Twitter IPO Double?) to his most likely accurate prediction that Twitter will indeed double ( Kass: How Tweet It Is.

Outside of referring to my life as "modern," Papa Kass hit me with the one play on my name I have only heard three million times before.

In all seriousness, though, given Kass' knowledge and prowess as a trader and investor, there's no way he doesn't comprehend what I am saying in that article. In fact, he has likely forgotten more about investor psychology than I'll ever know.

Before reiterating thoughts on Twitter, consider Apple (AAPL).

A classic case where some investors have nothing to blame for their losses -- realized or not -- but their externally influenced emotions.

You had cats like AAPL analyst Brian White (I'm not sure where he works now or if he uses an 'i' or a 'y' in his name) with cute price targets of $1,111 as the stock topped $700. Seemingly everybody (except for Kass!) jumped aboard the AAPL train. It turned into this Bushian battle between good and evil.

Tons of retail slugs and, I would assume, more than a few institutional guys bought Apple stock to fight against the unjust forces -- often referred to as "manipulators" (I think some of these hacks use that term, idiotically, to refer to Papa Kass) -- they perceive as keeping it down. It wasn't an investment thesis; rather it was fighting the good fight when these people bought AAPL at the top. And they had the perfect rationalization standing by their sides cheering them on. Folks such as White with their $1,111 targets.

We know the story there, epitomized in the extreme by all Apple hedge fund manager Andy Zaky.

Here's the background on that:

Apple Bulls Having Love Fest: Please Get a Room (October 11, 2012)

The rise and fall of Andy Zaky (March 4, 2013)

I love Philip Elmer-Dewitt (great journalist, even better guy it seems) and feel for Zaky's peril, however it is what it is.

That's just one illustration of investor psychology crushing people.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,735.06 +57.16 0.34%
S&P 500 1,957.49 +6.67 0.34%
NASDAQ 4,463.0710 +10.2790 0.23%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs