Satori Fund founder Dan Niles has reversed his stance on Apple ahead of the company's big product event. While the stock was one the firm's bigger long positions in August, it's now a large short position. That shift was driven mainly by Apple's trading pattern ahead of the company's product launch event on Tuesday, the Epic Games ruling and the reopening of the economy, Niles told CNBC's "Squawk Box." "In the month leading up to a new product launch, the stock is up about 76% of the time," he said Tuesday morning. "Then the day they actually do the product launch, the stock is actually down about 76% of the time and struggles for the next two weeks." He said the Apple-Epic Games court ruling is a "bigger issue" because it will cut into Apple's 30% fee. A judge ruled last week that Apple must allow developers to give consumers a way to pay for in-app purchases outside of Apple's App Store. But the "fundamental portion" of his thesis on Apple has to do with the economic recovery from the pandemic. "This company benefited tremendously from Covid," he said, noting that Mac and iPad sales were down year over year in December before the pandemic, but that in the March quarter they surged. "A lot of that is going to reverse like we've seen with streaming with Netflix, e-commerce with Amazon. You're going to see the same thing with Apple when you get into the September quarter," he added. Plus, the iPhone 13 expected to be introduced Tuesday will have "just tweaks," Niles said. "It's not revolutionary like the 5G launch was last year." In addition to Apple, Niles also said his firm is short a basket of S & P 500 and Nasdaq names, without naming them, because it believes there will be a 10% to 20% correction at the end of the year as the Federal Reserve starts to remove the monetary stimulus it injected into the economy during the pandemic.
Satori Fund's Dan Niles on what investors should watch after Apple product launch event
Satori Fund founder Dan Niles has reversed his stance on Apple ahead of the company's big product event.