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Thursday, June 25, 2009

What To Expect From Jim Cramer Mad Money?

By Anne Durrell

Jim Cramer is crazy. On his show, Jim Cramer mad money, he jumps about and screams like a crazy guy.

But last year he earned 12% compared to 6% average from investments he picked, so after all that proved he is not crazy at all.

Hundreds of thousands of investors watch Jim Cramer mad money on CNBC each week.

Jim Cramer was one of the few persons who can be followed and was listened by many people when the world was spinning out of control and the stock market was spinning down to the toilet and investors were panicking.

When a stock has started going up, Jim Cramer mad money likes to ride it up and buy. His shows plan for the market to keep doing what is doing, so his mad money picks end to be aggressive.

Conversely, if a stock starts to fall, Cramer wants to dump it before it falls further. This is not a bad technique when the market is less volatile and the swings are slower and more predictable.

But when market are going badly, stocks can reverse direction in a hurry and this will make them go badly quickly too.

One big problem Cramer has is when he interviews executives; he will normally recommend that you buy their stock.

If you're wondering on what stocks to pick, the best advices can actually be gained from Jim Cramer mad money shows, not Cramer's recommends on those executives stocks.

It is clear there will be a short term jump in price for those stocks after he recommends it, as many people will run out and buy these stocks.

So if you are quick on the draw and do just the opposite, ready to buy when he says "sell" and ready to sell on the margin when he says "buy" then you can expect to do quite well. - 23226

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