Apple has increasingly invested in riskier financial assets
$434 million
Apple’s vast financial holdings, held mostly offshore, are equal to about a third of its market value, and its investments generate about 7% of the company’s pre-tax profits. But going big in finance comes with risks.
Published | Photo by AP Photo/Mark Lennihan
As the company’s financial assets have ballooned, they have become more complex: Its derivatives carry a “value-at-risk”—the maximum likely loss in an average day— of $434 million, the Economist reports.
That’s about the same as the combined value-at-risk of the world’s ten largest investment banks.
Apple used to invest in low-risk assets, like blue-chip government bonds. But since 2011, when Steve Jobs died, it has increasingly invested in riskier assets.
