Cramer’s Mad Money Recap Analysis

Is it profitable to invest in seasonal companies?

Jim Cramer is the legendary host of the popular financial-themed television project Jim Cramer mad money. Has an excellent education. First, he received a degree from Harvard College, and then he defended his doctoral dissertation at Harvard Law School. Graduating from college and getting his doctorate was not easy for Jim. For almost a year, his only home was a car. Here is such an exciting life situation.

Cramer earned his living as a journalist. It doesn’t matter who his employer was — the Governor of California, Jerry Brown, or the periodical for lawyers, The American Lawyer. They were all delighted with his punchy character.

Cramer began earning investment experience at the university, from which he graduated in 1984. He went to Goldman Sachs Group in graduation, where he worked for three years as an investment consultant. After his dismissal, Cramer founded his hedge fund, which brought in $ 10 million in income annually.

On the one hand, why not listen to an experienced person who has been broadcasting for investors since 2005? But behind the attractive personality, there are also dark spots acquired during his investment path.

Both phrases hint that someone is lying and inventing a lot. Nevertheless, Cramer’s outrageous performances attract many people who persistently adhere to Cramer’s trading recommendations. Often, loyalty to a star becomes the cause of unsuccessful deals, for which they are not very punished.

There were cases when a journalist openly manipulated stock prices. He predicted their rise or fall, placing himself in the correct position. It has led to the NBC channel banning him from making transactions with securities that appeared in Mad Money within five trading days after the broadcast. In addition, Cramer is obliged to inform the channel’s management about all his position’s actions on the air.

The essence of the strategy

In his speech, Cramer singled out several stocks of American companies and stated:

In the issue, the shares:

• Tesla (TSLA)
• General Motors Company (GM)
• Newell Brands (NWL)
• Camping World Holdings (CWH)

He was referring to a bundle of speculative profit money. Reviewed Each stock in the light of seasonal forecasts made by trader Larry Williams on his I trade website. Analytics attracted the presenter because Williams has been studying seasonal aspects of financial assets for a long time. He wrote a book on this topic, “How seasonal factors affect commodity prices.”

Tesla’s (TSLA) profit according to Cramer’s strategy from 2016 to 2020

The process worked in the first three years of the study; for 2019, it turned out to be a failure and took away most of the profits previously earned by Tesla. So for 2020, I brought everything back. This approach could make excellent money – almost 25% per month in 2020. Several past years have shown the profitability of the Tesla stock strategy. The average yield would be 6.85% per transaction.

Profit of General Motors Company (GM) according to Cramer’s strategy from 2016 to 2020

General Motors Company, the start of our research is not too optimistic because, in 2016, we would have a loss on the position of 5.3% would. 2017 would not have been very happy either, because according to the first two years, there would still have been a loss. But 2018 would have been successful – the profit would have been 22%. After that – frustration again, because 2019 would have taken 6% of the profit. The shares have gained more than 50% in 2 months. We got two unprofitable years out of 5, but the system generally works. The average return on transactions is almost 12.8%.

Profit of Newell Brands (NWL) according to Cramer’s strategy from 2016 to 2020

2016-2017 for Newell Brands does not show anything interesting — a waste of time. But since 2018, stocks have been volatile, which brings only losses. But 2020 puts everything back in place and brings a solid profit, resulting in which the strategy confirms its relevance. As a result, the average yield was 5.2% per transaction. That’s not bad.

Camping World Holdings(CWH) profit according to Cramer’s strategy from 2016 to 2020

Camping World Holdings is the most seasonal company represented by Cramer. She is engaged in the sale:

• Recreational vehicles camping
• Supplies

The history of observations on the issuer begins in 2017. For the first three years, the strategy guaranteed only losses. But 2020 turned out to be a saving year for the process again. As a result, the average return per transaction was 38%.

Promotions outside of Mad Money Recap

Profit of The Boeing Company (BA) according to Cramer’s strategy from 2016 to 2020

For four years, the strategy had mixed dynamics in the shares of The Boeing Company and brought only 2.4% profit. So it would be better to put the money on a regular deposit. But then 2020 comes again and carries 78% profit, saving the strategy from shame. The average yield is just over 16%.

Profit of The Walt Disney Company (DIS) according to Cramer’s strategy from 2016 to 2020

After Memorial Day, there are many more visitors to entertainment parks. The audience of media resources increases proportion to the number of schoolchildren and students who go on vacation. 2016-2017 for The Walt Disney Company by a cumulative loss of about 10%. 2018-2019 bring about 5% profit. Until 2020, the strategy looks so-so. But the growth in 2020 shows us a positive outcome. The average yield is 3.6%.

If we remove 2020 from the sample, it turns out that instead of profit, we would have a loss. On average, we would lose -0.7% per transaction. Only one issuer showed gain every year — this is our favorite Aeroflot.

Jim Cramer is an engaging, authoritative, and charismatic personality. He is a fantastic presenter who is always interesting to watch—a lot of experience in investments, access to a vast audience.

All this did its job — he became a legend. But first of all, he is a TV presenter and showman trying to make his Jim Cramer mad money show brighter than similar programs on American television.

Some promotions may be affected by seasonal demand for their goods and services, but do not forget about more significant factors:

• Quarterly and annual financial statements
• Changes in the dividend policy
• Unexpected changes in management
• Corporate events related to the issuer’s activities general
• Market background

Cramer has made very controversial predictions before. Therefore, before following his strategy, weigh the pros and cons and make the right choice. Then, forget about Cramer’s strategy and get into the good old long-term investing. I assure you, the result will be much better.

No financial and investment guru can guarantee you this or result in investing. Remember that they work for their audience, create their brand, and want to be recognized and monetize their income. Only then do they work in your interests. Therefore, do not repeat anyone’s strategies and specific deals. Think with your head.