Today, Apple's Steve Jobs announced amazing new products, alliances, and sales numbers, but AAPL lost 5% because of the general market direction due to mainly to the news of Citi's subprime slime.
Yesterday was when the late-comers bought their positions in Apple, and yesterday I sold one, taking a 25% gain off the table, capitalizing on their speculation. In the shower today I reflected on the wisdom of "the day before the day before" as a general strategy for taking advantage of the speculators who come "the day before" some event such as an earnings report or product introduction. This was the strategy of Levi Strauss in the California Gold Rush of the 19th century; it worked out well for him!
Speculating on the speculation has a much better risk/return ratio than speculating on the actual event. The reward may be less, but the risk is lower.
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