Apple Inc Risk Points versus Technology

Apple Inc (NSDQ:AAPL) Risk Points versus Technology (XLK)

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The results here are provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation.


This is a scatter plot analysis of the critical risk points from the option market for Apple Inc (NSDQ:AAPL) compared to its own past and the Technology ETF. In order to examine the forward looking risk for Apple Inc (NSDQ:AAPL) the next 30-days, we must look to the option market.

Now, before we dive into the analysis on AAPL, we make one critical note since we're talking about options:

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In the "Why This Matters" section at the end of this article on Apple Inc (NSDQ:AAPL) , we're going to take a step back and show in great specificity that there is actually a lot less "luck" in successful option trading than many people know.

But that's at the end, now let's jump back into the risk point charting and number crunching for Apple Inc (NSDQ:AAPL) . We start by noting that AAPL is in the information technology sector which means along with some other industries we also compare the company to the closest match we could find, which was the Technology ETF (XLK) as a proxy for Apple Inc.

We have highlighted the IV30® for XLK and for AAPL in the table below.

S&P 500 (SPY) IV30     10.81%
Nasdaq 100 (QQQ) IV30     15.48%
Technology ETF (XLK) IV30     16.35%
Biotech (IBB) IV30     18.16%

Apple Inc (NSDQ:AAPL)
AAPL 52 Week Low IV30     15.94%
AAPL Current IV30     17.36%
AAPL 52 Week High IV30     33.57%

AAPL Current HV30     21.27%

Apple Inc Implied Risk Scatter Plot
(a new risk chart, built for option traders)

Scatter Plot Risk Legend
The blue point is the current 30-day implied volatility for Apple Inc.
The black point is the current 30-day implied volatility for the Technology ETF (XLK).
The red point is the 52 week low in IV30® for Apple Inc.
The green point is the 52 week high in IV30® for Apple Inc.

The various other scatter plot points in the middle give us risk context outside of the information technology sector.

The IV30® is the risk reflected by the option market in the stock price for the next 30 calendar days.

* We can see that the risk as reflected by the option market for the next 30-days for Apple Inc is in between the indices we have charted but is above the Technology ETF (XLK), which we use as a proxy for Apple Inc.

* We can further see that the current IV30 for Apple Inc of 17.36% is closer to the annual low of 15.94% than the annual high of 33.57%. Simply stated, this means that the option market is pricing less risk than the average over the past year.

* For some context, we note that the annual range in IV30® for the Technology ETF is between [10.88%, 36.15%] while Apple Inc has had a range of [15.94%, 33.57%].

Get this same analysis on any ticker here:

A New Kind of Risk Point Chart
This is chart was developed for the trader. It allows us to easily see where the forward looking risk for Apple Inc (NSDQ:AAPL) lies relative to the last year, and the various major stock groupings and the Information Technology sector without using time series data, which can confuse the information.

While the option market risk rating is on the low side, we note that companies in this situation are still susceptible to sudden stock move risk, it's simply the probability of that large stock move is depressed. Buyers of options and volatility may find these prices more attractive than at other times.