Apple Inc. (NASDAQ:AAPL) has seen its shares tumble more than 13% so far in 2013, and more than 33% since it hit highs of over $700 per share in September. The stock was the most widely held among hedge funds and those vehicles are being sorely tested in the first quarter of 2013. Here’s a chart of the top holders of the stock in the financial world (the list consists of the largest asset managers, many of which hold the stock in mutual funds):

Apple largest shareholders

The average hedge fund returned just 6.2% in the full year for 2012. The S&P returned more than double that number. We’ve looked at the poor performance of funds before, and offered other reasons for the 2012 short fall, but Apple Inc. (NASDAQ:AAPL) stock, looking at the above chart, should take some of the blame.

One of the most prominent followers of Apple Inc. (NASDAQ:AAPL) stock among the well known fund managers is David Einhorn. He’s outlined his case for the company before, but his fund was down 5% in the fourth quarter of 2012, and returned just 8% for the full year. After selling off some Apple Inc. (NASDAQ:AAPL) in the third quarter, he bought more in the last three months of 2012.

Some of the negative returns in the fourth quarter of 2012 can certainly be correlated with the fall in Apple’s stock. In Einhorn’s view, a company like Apple, which is still growing quickly and trading at a low valuation, should not have had a big down side risk. He may be right in the long run.

But the long run is an ephemeral concept, and it’s often difficult to grasp in the hedge fund world. Right now, Apple’s growth appears to be slowing down, and even with a P/E ratio of well below 10 net cash, investors just don’t seem interested.

The average company in the S&P 500 (INDEXSP:.INX) trades at a P/E of close to 14. At Apple’s current price, investors expect the company’s growth to come in well below the average large cap stock, not Google Inc (NASDAQ:GOOG) (P/E=23), not Microsoft Corporation (NASDAQ:MSFT) (P/E=15), the broader market.

At that level the current valuation may not make sense, but there’s no law saying it has to. In a case like this, the valuation, rather than the price, can be wrong. P/E is not exactly a precise indicator. Only time will tell what valuation is correct. Hedge funds are going to have to deal with that in the months ahead if Apple Inc. (NASDAQ:AAPL) shares don’t recover.