“The way a company can achieve enormous success, thereby enjoying large gains in its stock price, is by introducing dramatic new products into the marketplace. I’m not talking about a new formula for dish soap. I’m talking about products that revolutionize the way we live.” –How to Make Money in Stocks

As investors, we always have our eye out for the next wave of products that can change lives. The Smartphone undoubtedly changed how we managed out daily lives, evidenced by Blackberry early and again when iPhone debuted in 2007. Nothing like the iPhone had ever been seen and its early and continuous success led to the demise of former leaders in the cellphone industry such as Sony Ericson, Motorola, and Blackberry. Apple was changing the way we used our cellphones, and everyone else was simply trying to catch up.

Apple’s lines of products were led by the second generation iPhone when its stock broke out of a stage one flat base on 7/17/2009.

Since then, Apple’s strategy has seemingly changed. The innovation has slowed and new products are not necessarily new ideas. The “Apple Watch” seems to be a response to the Samsung watch and the iPhone 6 Plus was created to compete with larger screen Samsung phones that have reached an 85% global market share (link to article http://thenextweb.com/google/2014/07/31/android-reached-record-85-smartphone-market-share-q2-2014-report/).

Will Apple be considered an innovator in years to come? Can a leader remain on top without continuing to bring new ideas to market? Don’t let your personal love of a market brand override the technical activity of the stock. Reacting to price and volume will continue to be the best way we manage our handling of leaders.

Best Returns,

The MarketSmith Team