Savvy Trades and Investments

[mandjb]

Whatever Cramer says, do the opposite!

That guy is a serious (and serial) underperformer.

https://www.ifa.com/articles/cramer_chasing_mad_money/

Under such a microscope, Cramer's stock picks lost luster. The Wharton researchers found that his AAP portfolio produced an annualized 4.08% return in the 17-plus years reviewed. At the same time, the S&P 500 gained 7.07%.

If you go back longer, it gets worse:

From some years ago.....

Talk about overrated! This guy’s seen ranting and raving all over the business channels. He has a large following of supporters, apparently. I can’t bear to watch him more than a few seconds – his spittle-laden rants make me too nervous. He is…Jim Cramer

Cramer is an ex-hedge fund manager and current star of CNBC’s Mad Money show. He’s on TV every day and has legions of followers. How did he get there? Not by making money for people, it seems. Indeed, following his recommendation over the last decade or so would have been disastrous. Some examples:

On February 29th, 2000, Jim Cramer gave his "top 10 stocks" that are "going to make it in the New World". I actually saw that show and he was advising everyone to sell all their “old economy” companies and go “all in” on the internet darlings. Here’s the actual quote…

You want my top 10 stocks for who is going to make it in the New World? You know what? I am going to give them to you. Right here. Right now.
OK. Here goes. Write them down -- no handouts here!: 724 Solutions (SVNX), Ariba (ARBA), Digital Island (ISLD), Exodus (EXDS), InfoSpace.com (INSP), Inktomi (INKT), Mercury Interactive (MERQ), Sonera (SNRA), VeriSign (VRSN) and Veritas Software (VRTS).
We are buying some of every one of these this morning as I give this speech. We buy them every day, particularly if they are down, which, no surprise given what they do, is very rare. And we will keep doing so until this period is over -- and it is very far from ending. Heck, people are just learning these stories on Wall Street, and the more they come to learn, the more they love and own! Most of these companies don't even have earnings per share, so we won't have to be constrained by that methodology for quarters to come.
So, if you can't own the retailers, and you can't own transports, and you can't own banks and brokers and financials and you can't own commodity makers and you can't own the newspapers, and you can't own the machinery stocks, what can you own?
A-ha, that just leaves us with tech. That's why we keep coming back to it. That's why, despite the 80% increase in the Nasdaq last year, we are looking at another record year now. It is by that process of elimination that I have picked my top 10. And my next 10 and my next 10 after. Only tech companies are worth owning. The rest? You can have them.


This was delivered just weeks before the Nasdaq began its 80% plunge. Some of these (i.e. Exodus) were bankrupt and worthless in short order. Ouch.

Note that this was not one bad stock pick – we all have those. This was a recommendation to move whole portfolios to exactly the wrong place! Cramer skated right through it. I just don’t get it.