Roger Carlsen, a retired investor in Frankfurt, Illinois, has happily watched his holdings of Apple Inc rise to more than $600 a share, having held the stock for 12 years.

But with the company's earnings report due Tuesday, he's not sure the stock has much further to go. So he's been in the options market, selling call options to take some profits because he expects the shares in the world's most valuable company to have peaked, at least for now.

"I don't why, but it seems like Apple has lost some of its luster," said the 68-year-old Carlsen.

He's not alone. The stock has slipped from its $644 all-time high hit in April, trading on Monday afternoon at $603.00, hit by a broader-market sell-off and concerns that worldwide economic weakness will hurt consumer demand.

Through good times and bad in the equity markets, plenty of investors have held onto Apple. They have watched shares of the iPad and iPhone maker deliver outstanding returns year-in and year-out, even when broad markets have floundered.

But Apple faces an unusual phenomenon when reporting earnings this time around: lowered expectations. With consumers holding off on purchases ahead of the next iPhone around October and with slowed demand around the world, few expect the company -- which has topped Wall Street expectations with near regularity -- to deliver another big quarter.

As a result, uncertainty in Apple has increased, part of the reason the options have been so active.

Apple options are pricing in about a 5.5 percent move in the shares in either direction after earnings, based on weekly options expiring this Friday, said Enis Taner, global macro editor at RiskReversal.com. That is above the average 3.7 percent one-day move over the past eight quarters.

"Right now retail investors are apprehensive due to the cloudy future of slowing global economies," said Jeff McAllister, vice president of education at options education firm website optionsanimal.com in Lehi, Utah. "They are not sure any stock will go up, including Apple."

Carlsen, who owns a small metal art business, said he recently sold August $650, $660 and $675 Apple calls on the view that shares will not reach $675 by August expiration. Call options give the buyer the right to buy shares of a company at a fixed price by a certain date.

"I have been anticipating that it would surpass its all-time high ... but it has not yet occurred," he said. "But by the end of the fall, I think it will."

Summer is often a seasonally slow period for stocks.

INVESTORS PILE INTO WEEKLYS

The one certainty that investors -- big and small -- can be sure of is that options activity in Apple stock will remain high regardless of the stock's direction after earnings. It has become the most heavily traded name in the options market, not including exchange-traded funds.

With the stock at around $600 a share, options offer an increasingly cheaper way for investors and traders to manage exposure.

Apple's short-term options -- known as weeklys -- have been popular among retail and institutional investors. These contracts have recently accounted for an unusually large percentage of its option volume, pointing to increased speculation, possibly among investors who can play the stock at a relatively low cost compared with standard monthly options.

Weekly contracts, which expire at the end of each week, were introduced in the U.S. options market by the Chicago Board Options Exchange in 2005 and differ from most contracts that expire monthly.

At the beginning of January 2012, weekly options accounted for about 11 percent of daily option volume in the S&P 500 index and 33.3 percent in Apple, according to data from options analytics firm Livevol in San Francisco.

But as of July 19, weekly options represented 17 percent of the average daily volume of the SPX and 48 percent in Apple, Livevol data showed.

"Option volume in the weeklies as a proportion of total volume has increased dramatically in both SPX and Apple and in similar percentage increases," said Ophir Gottlieb, managing director of Livevol.

"This could point to more speculative option trading if you consider shorter-term positions to be more speculative in nature," Gottlieb said.

He said a potentially troubling difference between Apple and the S&P 500 since the start of 2012 is the change in average daily volume. While SPX average daily options volume is down 7 percent, Apple options volume is up 50 percent, with weeklys accounting for 80 percent of the rise.

"That could be retail accounts trying to position for earnings," Gottlieb said, though he said he does not know how much trading in weekly options comes from retail investors.

Institutions have jumped on the options bandwagon. So far this year, nearly 100 million option contracts have traded in Apple, first among options in actively traded single stocks. On average, Apple options make up 7.8 percent of total U.S. equity option volume, excluding exchange-traded funds, according to options analytics firm Trade Alert.

If the extraordinary growth seen in Apple earnings over recent years pauses, volatility in Apple's stock price will rise as hedge funds rush to exit their stock positions and lock in any existing gains, said Gareth Feighery, a founder of options education firm MarketTamer.com in Philadelphia.

"That would create even further interest in the options," Feighery said. "As a result, whichever way Apple moves post-earnings, the one certainty is that options activity in Apple will remain elevated for the foreseeable future."

Edwin Retief is another small investor closely watching the earnings on Apple. The 70-year-old mechanical engineer owns Apple shares and long-term January 2013 $600 strike call options.

"I am hoping for a pop in the shares and that Apple will get back to its recent high of $640, and even pass that," Retief said.

But he's not entirely sold on that happening and is also considering a hedge. Retief, who lives in Naperville, Illinois, is contemplating buying protective puts on the stock before earnings to hedge his exposure.

"It all depends on what the company forecast is for next quarter and what they achieved in the last quarter," he said of the outlook on the stock.