Friday, September 08, 2006

When I Say "Zig:"... Zag!

Wow, if you invest by following Cramer, your head and your pocketbook must be hurting. Listen to what he said last night:

On his July 27 "Mad Money" show, Cramer told viewers to consider buying Valero, the best of breed in the oil-refining game because he thought it would report a blowout quarter.

Although he was correct in that the company reported an upside surprise, Valero's stock barely moved, he said.

"I forgot the most important fact out there: This is about stocks -- not earnings -- and looking right," Cramer said.

The fact is the company had topped and should have been sold, he said. At this point, Cramer urged people to sell Valero even though it's down because oil has peaked, and the stock has a chance of falling down five more points.

He did the same thing late last fall when he reversed his call on Natural Gas stocks like CHK & ECA. When he said that, he was absolutely wrong and then he was a buyer after they went back up 10 to 15%. I can't believe his quote, "This is about stocks -- not earnings -- and looking right". Didn't he say in another blog I posted that the key to making money was finding stocks that will have earnings beating expectations? Or was that the rule just for that week? Ay-yi-yi!
All of you still investing per Cramer, read JG's book... please.

As long as we're having fun at Cramer's Expense, let us play a little game I like to do every now and then. Let us look at his picks on a show on a specific day and compare with the MFI portfolio and the benchmark. I'll pick July 1st as that is a reasonable timeframe... Hmm, I'll have to pick July 31st as he was on vacation July 1st. On that day Cramer recommended 21 stocks.

My MFI Tracking is up 1.28%
Benchmark is up 1.42%
Cramer is down 0.04%.

Just the facts.

Call The Doctor - MGLN is Sick. Wellpoint cancelled a deal with MGLN causing their stock to take a major hit this week (WellPoint Ends Magellan Midwest Pact). What has happened is there has been so much consolidation in the HC Insurance industry that these companies (AET, UNH, WLP & CI) are really beginning to have pricing power with HC providers. I think that is one reason why the hospitals like THC are struggling.

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