LOL! Somebody sat down and said, "How can we design a system where Cramer loses?" The flaws are obvious: Our method of evaluating Jim Cramer's stock recommendations is simple. We record his Lightning Round recommendations as he makes them on TV, and then we have our monkey make recomendations at random on the same stocks. We then wait 30 days, and see who came out on top. If the recommendation is buy and the stock outperforms the index over the 30 days following the recommendation, then it is counted as a good pick. Otherwise the result is counted as a bad pick. If the recommendation is sell, the results are reversed; the recommendation is good if the index beats the stock, and bad otherwise. To calculate the average return on investment, we add all the returns for buy recommendations, then subtract the returns for sell recommendations, then divide by the number of recommendations
LOL! Another great quote from the Cramer blasting site: "Detailed Results - December 31st, 1969 - Monitor Jim Cramer's Mad Money stock pick performance at CramerWatch.org"
i'd LOL at max, but instead i feel like i'm beating my head against a hollow wall. cramer - the only thing he trades, action alerts - jan 1 2002 - dec 1 2006 - was 24.58%. the s&p's performance during that time was 22% that *doesn't* include the action alerts portfolio he scrapped in 2001 which underperformed the s&p. so he beat the s&p. nice job. and maybe it's better than the average dope at home. (and to correct something before - i thought his performance did NOT include commissions. it does. mea culpa, and nice that they keep that above board; most places do NOT). i'll let others whose statistics knowledge is fresher than mine debate whether beating the s&p by 2% over a 5 year period is statistically significant to 'prove' cramer's action alerts are better than random performance. but, it doesn't have to be "cramer is better than (you, my pet, a ouija board)". it has to be "jim cramer is a market genius who can make you rich". why? because cramer and his services tout himself that way. and as an investor/trader, which is who cramer is speaking to (and what he 'is' now), he's not a market genius. again, in summary: (nearly) 5 year performance: cramer, +24.58% s&p, +22%
I'm not defending Cramer's performance. My criticism is about the method of determining that performance. Even now, when most of the discussion seems to be about the TV show picks, you offer up a Cramer paid for subscription service. In any event, is there a link for the 24.58%?
You are one crazy mofo' Maxy! The only job worse than defending Crammer... ..is (was!) being Saddam's lawyer. later, w
My criticism of Cramer's Mad Money show is that he uses the closing prices of the stocks as his entry price for telling people whether they could make money on his picks or not. Everyone knows you aren't going to get the closing price as your entry price (because of thousands of tag along Cramerite orders) so his returns are artifically inflated from the start.
Its an entertaining show for many people and he makes beginner investors think more of what makes a good buy besides a stock tip from your neighbor. This excludes the lightning round.