RIMM/AAPL Pair Trade
    Over the past year, one of my favorite trades had been to trade RIMM and AAPL versus one another. Believing these stocks are similar in nature, I have looked for short term price movements where the behavour of one is not confirmed by the other. Today we have such an event.
    Since Thursday’s close, RIMM has lost 13% while AAPL has lost 2%. I will concede that AAPL has the dominant brand and product line and that RIMM’s chart is flashing bearish signs. However, an 11% discrepancy in two days may compensate for the risk. I am buying RIMM, shorting AAPL and looking for a narrowing of this spread.
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Posted by Sean Hannon on December 3, 2007 at 2:07 pm --
Seems like a good solid short-term move. RIMM is short-term oversold, that’s for sure. Seems like a lot of different analysts are hitting RIMM hard all at once.
RIMM is definitely oversold short-term after a pair of negative remarks from Piper Jaffray and Morgan Keegan (who?). Concern over demand I think is unfounded and BBs are selling like hotcakes, especially the Curve on AT&T and T-Mo. I bought today on the dip, I think it’s way overdone and RIMM is supposedly releasing the 9000 edition of the BB over the next couple months. Possible touchscreen interface like the iPhone, although I don’t know how hardcore BB users will feel about losing a tactile keyboard. I think this 13% drop over the last two days is a gift for long-term buyers.