14 ms·

The Inverse Jim Cramer ETF

417 points by hn8305823 4y ago

OnlineGladiator 4y ago
https://old.reddit.com/r/wallstreetbets/comments/109cswl/inverse_cramer_i_analyzed_all_21653_buy_and_sell/ https://old.reddit.com/r/wallstreetbets/comments/109cswl/inv... The inverse Cramer analyses on WSB are some of my favorite posts there (although it's a cesspool today so that's not much praise). But yeah, there are actual data-driven strategies to make money by inversing Cramer.
- hinkley 4y ago
  I’m betting that most people who listen to Cramer aren’t watching his videos the very second the come out, on 2x speed so they can get the tips before they are public knowledge. So effectively he is inciting mob action on stocks, but not in real time. So if you disagree with him and follow him anyway, you have a sort of moral equivalent of insider information. If you sell a stock in the middle of their buying frenzy at least. If you buy a stock the day after he says sell, you can benefit from the market correction when the rest of the cramerless world can’t figure out why TSM dropped five bucks on Monday for no reason, and decide to buy more.
kristjank 4y ago
What a beautiful bag of tomfoolery :D
idlewords 4y ago
If Cramer ever says to buy it, it will segfault the economy.
- frob 4y ago
  Now my wheels are just spinning over self-shorting funds.
  - SparkyMcUnicorn 4y ago
    Essentially what happened with Luna... sort of.
  - deleted 4y ago
    [deleted]
- pphysch 4y ago
  stack overflow seems more likely
- CalChris 4y ago
  Russell Paradox violation.
  - elil17 4y ago
    The Russell 2000 Paradox
  - yrdmb 4y ago
    Halting problem.
    - idlewords 4y ago
      Halting opportunity
      - dalys 4y ago
        Halting scheme
- __derek__ 4y ago
  Ideally, that should net out to an expensive market-neutral fund with 0% expected returns minus the management fees and transaction costs, the latter of which could be really high.
- jeron 4y ago
  i think it would just count as hedging against his own words
- kingTug 4y ago
  How the hell is this guy not in jail
  - cced 4y ago
    He’s serving someone’s, somewhere’s interest.
    - red-iron-pine 4y ago
      Who owns the channel he's on?
- make3 4y ago
  stack overflow* the economy
- dan-robertson 4y ago
  There are actually ETFs that contain themselves (or rather, ETF X is e.g. 10% ETF Y which is 10% ETF X. So long as the total amount of X owned per unit of X is less than 1 (in absolute value), the arithmetic mostly works out. Though I don’t know if any ETFs directly contain themselves.
SuoDuanDao 4y ago
I came across a humorous video of someone getting his fish to invest in stocks https://www.youtube.com/watch?v=USKD3vPD6ZA&t=715s https://www.youtube.com/watch?v=USKD3vPD6ZA&t=715s He was essentially teaching algo trading, and also tracked wallstreet bets sentiment analysis. He went so far as to pitch his investment strategy to serious tech investors (it was ahead of the nasdaq at the time). His Wallstreet bets tracker had been tanking so he focused on the fish investing fund, but I was waiting for one of the investors to suggest he inverse wallstreet bets and make a lot of money.
- recursive 4y ago
  Fish investing was tanked too.
  - SuoDuanDao 4y ago
    not surprising, but I'd bet SWSB would have been going strong in the interim...
  - logicalmonster 4y ago
    Was this a deliberate or accidental pun?
    - danuker 4y ago
      I would assume so. You should know that P∨¬P, logicalmonster.
      - layer8 4y ago
        Depends on whether the law of excluded middle holds in your jurisdiction.
        davrosthedalek 4y ago
        That sounds discriminatory.
dublinben 4y ago
Similarly, an ETF inverse of Cathy Wood’s ARK fund has outperformed quite a bit over the last couple years. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=2021&firstMonth=12&endYear=2023&lastMonth=2&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=ARKK&allocation1_1=100&allocation1_2=0&symbol2=SARK&allocation2_1=0&allocation2_2=100 https://www.portfoliovisualizer.com/backtest-portfolio?s=y&t...
- bryanlarsen 4y ago
  You can show really poor or really good results for pretty much any high volatility portfolio by cherry picking your time period.
  - kristopolous 4y ago
    Over a multi-year time period? Take I dunno, Bitcoin. As you increase the time window, showing a net loss is less and less possible. I'm not a crypto bull and I think it will tend towards zero someday but this is inarguable using current historicals.
    - Eisenstein 4y ago
      As you increase the time window, the possibility that the wallet is abandoned, the wallet owner is dead, or the bitcoins get scammed or lost in a exchange collapse quickly reaches 100%.
      - kristopolous 4y ago
        Sure, but similar properties come with almost any store of wealth. Don't take this as advocacy, it's not. There's plenty of strong arguments against crypto without having to resort to such truisms
digianarchist 4y ago
(2022) Updated story https://www.etftrends.com/2-etfs-offer-inverse-and-long-exposure-to-jim-cramer-stock-picks/ https://www.etftrends.com/2-etfs-offer-inverse-and-long-expo...
gjsman-1000 4y ago
The fact that he still had a job after his 2008 mistake of insisting that Bear Stearns was fine and a safe place to keep your cash, is astounding. That should've been an unrecoverable mistake, especially with how strongly he was certain. "Should I be worried about Bear Stearns in terms of liquidity and get my money out of there? No, NO, NO!!!" (Afterwards... 90% loss in the next 6 days.) https://www.youtube.com/watch?v=gUkbdjetlY8 https://www.youtube.com/watch?v=gUkbdjetlY8
- nradov 4y ago
  His job is to attract viewers. Not to make accurate stock picks. When I watch a comedy show it's because I find it entertaining, not because I actually take advice from comedians.
  - smcl 4y ago
    The comparison to a comedy is a pretty silly one - comedies are pretty explicit about what they are and are pretty clearly not trying to give you financial advice or medical advice or anything like that[0]. Cramer is on a news network and tries to give the appearance of being a financial advice segment, stopping short (likely including the words “this isn’t financial advice” with a little implied wink of). It’s clear to you and I what Cramer’s deal is, but there are plenty of people out there who take him at face value. [0] - there’s sometimes product placement or even a little feel-good message about friendship or family, but rarely if ever anything that looks like actionable advice.
    - kortilla 4y ago
      Comedians that pretend to do news like Jon Stewart or John Oliver are just as harmful. Presenting biased views that shape people’s entire views of society can be much more destructive over a lifetime than bad stock picks. Destroyed family connections because people refuse nuance, non-existent careers because “capitalism bad”, etc.
  - lexapro 4y ago
    His show literally starts with "my mission is simple, to make you money".
m3kw9 4y ago
This is nothing more than a money grab to the chat groups that made it popular to note in hindsight that Cramer was wrong. Picking against Cramer is no more different than picking against a random person with random picks, which is like 50/50 except you will pay some ETF fees to do so but you will at least have fun losing money like in casinos
- jerf 4y ago
  That's the case if Cramer is just an honest guy making his honest picks completely independently, and nobody with any power would even dream of using his platform to do anything untoward, because everyone with any direct or indirect ability to influence him is just so darned honest that they wouldn't dream of exploiting such a large pool of useful reputation. I don't know why I feel I should point this out. I'm sure it's completely true. Don't even know why it would cross my mind to wonder. The financial world is so honest and full of integrity that it's obvious that this is true.
  - outworlder 4y ago
    You mean, hypothetically speaking, that Cramer would be gasp paid to promote specific stocks? Maybe when they are in a dire situation (or when insiders know it's going to be pretty bad pretty soon now™)? Yes, that would be bad.
    - kjs3 4y ago
      It doesn't have to be "paid" in any direct way. Cramer is an ex-Goldman Sachs, ex-hedge fund guy. He just needs to call up one of his old buddies and say "hey...Ima gonna tell the rubes to buy FooCorp tomorrow on the show". His buddies profit from knowing that early, and they do something 'nice' for old Jim down the road, like get him an 'exclusive interview' or something he can profit from. It's a racket.
      - linuxftw 4y ago
        The SEC prosecutes people for this type of thing. Much safer approach is to let your buddies buy first, then pump one of them. Lot's of plausible deniability. "Hey, every major fund has some XYZ, I just like the stock right now."
PaywallBuster 4y ago
by the same company who made SARK https://www.trackinsight.com/en/fund/SARK https://www.trackinsight.com/en/fund/SARK The short index of ARKK Innovation ETF by Cathie Wood
deltree7 4y ago
This is designed for gullible people who think Inverse Cramer will beat the market Hint: It won't Hint: Inverse ARK is down 25% YTD and down 40% from peak. tl;dr Memes are not the way to base your investment decision on
- BoorishBears 4y ago
  SARK seems to have outperformed ARK regardless unless I'm reading the wrong graph (which I might be to be fair) But honestly these meme ETFs aren't meant to be held long term, they're intraday funds. If you read their prospectus, they're charging you a lot to hold it with an expense ratio of 1.06% (compare that to VTSAX at .04%)
  - AustinDev 4y ago
    ARK started in 2020 SARK started near ARK's peak so the numbers will appear to favor SARK
    - BoorishBears 4y ago
      SARK was a bet that ARK was overvalued, so they wouldn't have waited for ARK's massive gains to fully evaporate
      - deltree7 4y ago
        If it were a bet that it was overvalued, the minute it reached fair valuation, the ETF should have been dissolved and distributed the funds. The fact that it still exists means, they are happy to collect fees from gullible people who are pro/anti large-internet-personalities.
- paulpauper 4y ago
  yup that is why buying inverse funds is a bad idea they decay exponentially if you want to bet against Cramer, short the 1x funds or buy puts
wnevets 4y ago
Its surprising he still has an audience after the economic meltdown of 2008-2009.
- zwkrt 4y ago
  There's few thing people like more than for someone to tell them what to do.
- MrMan 4y ago
  he called the market then, very well, he told you when to get out, I watched it. he said I just sold my beach house, get flat. I told my friends to get flat the week before.
  - wnevets 4y ago
    https://www.youtube.com/watch?v=V9EbPxTm5_s https://www.youtube.com/watch?v=V9EbPxTm5_s > Bear Stearns went under six days later I guess, if you wanna say that is calling it.
ckardat123 4y ago
If anyone is interested, here's a dashboard tracking Jim Cramer's recent stock picks, alongside the stocks' performance since his pick: https://www.quiverquant.com/cramertracker/ https://www.quiverquant.com/cramertracker/
WalterBright 4y ago
This is just an illustration that any stock market "system" contains within it the seeds of its own destruction. This is because if the "system" says "buy", then it must find people willing to sell. If everybody instead rushes to use the "system", then the price of the stock rises to negate the value of the "system". The only way to create a working system is to keep it a secret, and keep your trading volume low enough so that nobody notices what you're doing. Bernie Madoff's "system" worked only because he back dated the trades. Oops.
- deleted 4y ago
  [deleted]
paxys 4y ago
In order of effectiveness: 1. Buy and hold broad index funds 2. Throw darts at a board to pick individual stocks 3. Be knowledgeable, do your own research, read financial reports, custom build a portfolio 4. Listen to expert advice (Cramer, anti-Cramer and everything else)
- rom-antics 4y ago
  You forgot: 0. Get elected to Congress
  - peanuty1 4y ago
    0. Be Speaker of the House (Nancy Pelosi)
    - mooman219 4y ago
      > If one were to have $100 million invested in the Speaker of the House's stock-picking abilities at the beginning of 2019, the same investment would compound to $192 million as of today, slightly off the November high, when the portfolio hit its peak of almost $309 million. Pelosi's strategy generated a negative year-to-date return of 36.04%, accompanied by a negative one-year return of 36.61%, both slightly underperforming the S&P 500 (SPY). - Q3 2022 I wanted to take a look at this because given stock trades are public you'd think there'd be an ETF to track trades for the speaker of the house, but in reality it seems like people wildly overstate the profitability of their winning trades and understate their losses because "slightly underperforming the S&P 500 (SPY)" doesn't make the same headlines. In the long term, they appear to be no better off than the average portfolio picker.
      - airstrike 4y ago
        The last time I looked into this, the information on trades by members of the congress is delayed. Something like we know in which quarter they traded but not on which exact day, so the ETF doesn't really track their returns
sinerath 4y ago
This guy and the r/cryptocurrency sub pay my car insurance every month. just do the opposite and get rewarded.
anonu 4y ago
old article (oct 2022) and I dont think the ETF ever launched. EDIT: it launched today... Either way - TERRIBLE idea.
elil17 4y ago
>The premise behind SJIM is theoretically sound and can be boiled down to one observation: "the average stock picker performs horribly ." No it is not at all theoretically sound. The biggest issue with stock picking is low volatility. This does not solve that. The other issue is that stock pickers don't do better or worse than a random selection of stocks after adjusting for factor tilt. That means stock pickers can't do better than average, but they also can't do worse than average - so the whole premise makes no sense if you actually buy into the idea that stock picking doesn't work.
- vanattab 4y ago
  >That means stock pickers can't do better than average, but they also can't do worse than average. Not True. In fact virtually all stock pickers will do better or worse then the average. What you mean to say is the "average" stockpicker can't do better or worse then the average but that is of course a tautology.
  - elil17 4y ago
    What I actually mean is that 99.999% stock pickers can't intentionally do better or worse than average. And the tiny fraction who can are fund directors who are flooded with so much capital that they generate sub-1% alphas (which they eat up with their own fees).
    - Ekaros 4y ago
      Wouldn't it be possible to do worse? I think there should be enough opportunities to pick up true losers or almost dying companies. I'm not saying you could extract profit for those situation as there are too many other people trying to do it. But losing money should certainly be possible.
      - elil17 4y ago
        A few factors here: 1. You could try to do worse than average, and you'd succeed, but only because of the skewness of individual stock performance. You'd be no better than random chance at picking losers, it'd just be that most stocks are losers. 2. Factor-correction means the strategy of "choosing dying companies" won't work (e.g. in the Fama and French five factor model a dying company would an outlier in terms of high-minus-low, robust-minus-weak, and probably conservative-minus-aggressive).
diebeforei485 4y ago
We need an inverse Scott Galloway index as well.
ursuscamp 4y ago
The SEC will allow joke and meme ETFs, and triple leverage commodity ETFs, but a normal, non-leveraged Bitcoin ETF? No, we have to protect investors from that.
- chollida1 4y ago
  The SEC's reasoning for not allowing a spot BTC ETF is that you can't trust the markets it trades on and more importantly for them, they can't go and subpoena the trader information from, say Binance, if they think there is market manipulation going on iwth the spot price of BTC. They can do that with leveraged and meme ETF's so those same reasons don't hold.
  - drexlspivey 4y ago
    can’t they just have it track the price on regulated american exchanges only?
- TheCoelacanth 4y ago
  The SEC's job is to stop you from being defrauded, not to stop you from making stupid investment decisions.
chollida1 4y ago
I'm not the biggest Jim Cramer fan but he ran a successful hedge fund and has been in the industry for 20 years. He is an expert and knows what he's talking about and is pretty knowledgeable about the US cash equities markets. Part of the inverse Kramer ETF's success is that if you run a hedge fund you can make bank on 20 positions over a year or two. If you are on TV every night you need a new "winner" 5 times a week, which just isn't possible.
- throwaway29812 4y ago
  So because he tricked people into paying fees while performing more or less what the market does, he's an "expert"?
  - chollida1 4y ago
    > So because he tricked people into paying fees while performing more or less what the market does, he's an "expert"? Who do you think was tricked into investing with him? His fund did well, not sure how you are imagining an investor is being tricked into investing in a successful hedge fund? Can you elaborate on that? His returns according to wikipedia beat the market so again, I'm confused as to where you figure he did what the market did.
    - throwaway29812 4y ago
      Most funds don't beat the market in the long term, what's the sample size you are using? If he was so successful, why did he stop?
  - MrMan 4y ago
    his fund did well, but he is in a different business now, he is a TV personality.
- hn8305823 4y ago
  > he ran a successful hedge fund https://www.youtube.com/watch?v=r07Gg92YjOI https://www.youtube.com/watch?v=r07Gg92YjOI
VLM 4y ago
If you're bored and into financial "stuff" look up the returns of the typical ESG sector fund, then compare the return to the "YALL" ETF. I still laugh at the ticker symbol for "YALL". Sometimes you just can't make this stuff up. The analogy with the inverse cramer fund is pretty obvious as YALL is pretty much a reverse ESG fund "more or less much hand waving here".
- esaym 4y ago
  Buying.
- BenSahar 4y ago
  It's not really a reverse ESG fund. It just removes companies that have made perceived left-wing statements. An inverse ESG fund would be to use the inverse weighting of an ESG fund. Also, 25%+ of YALL is TSLA + NVDA + BA.
crazygringo 4y ago
This is really funny. But at the same time it reminds me of a certain type of World Cup bet, where you win mega $$ if you correctly pick the winners of all 64 matches. But you also win the same mega $$ if every single one of your picks loses, which of course is just as hard to achieve. (I forget how they handle ties but you get the idea.) All of which is to say, if Jim Cramer has no expertise in picking stocks, investing broadly in his picks is not much different from an index fund, you'll just roughly track the market. Whereas if he actively gets you to consistently and reliably lose money on high-volume publicly traded investments, then that's still (counterintuitively) a signal that somehow he knows something.
- danicriss 4y ago
  Relevant XKCD https://xkcd.com/2270/ https://xkcd.com/2270/
- KMag 4y ago
  > somehow he knows something and/or his public predictions influence the markets I'm pretty sure multiple data vendors compete to sell low-latency feeds of his picks, given his popularity. If a Cramer-tracking ETF underperforms the market, it's entirely possible that the ETF enters the market late (after the market has mostly priced in the Cramer-bump) and holds during the reversion to the mean. Though, I haven't looked into it. This is not investment advice.
- idlewords 4y ago
  I think it works more like a law of thermodynamics, where no matter how you arrange the elements or what signs you flip, whether you follow his advice or inverse it, any stock betting system based on Jim Cramer is guaranteed to lose money.
- hedora 4y ago
  There was an NLP based trading firm about 10 years ago that would run sentiment analysis over articles from industry analysts. According to someone that worked there, some of the most useful signal came from analysts that had strong negative correlations with future performance.
locallost 4y ago
There was an Inverse Galloway Index (although not an actual fund I think) that saw some fat returns when there was a seemingly unlimited money supply, but if you had invested in it a year and a half ago you would be deep in red. Over a period of a year or two nobody knows anything, possibly even in general. So can't blame Cramer too much. On the other hand there's no reason to listen to him either.
lisper 4y ago
> their earlier Short Innovation Daily ETF (SARK) that bet against Cathie Wood and her funds is still up 73% year-to-date. Only because this article was written in October of last year. Since then SARK is down 30% (along with the rest of the market). You can tell that the entire investment services industry is totally fucked up simply by the form of the information they put out. Investment returns calculated over a single time period is a case in point. What you really want to know is the expected value of the return given random entry and exit dates, but no one publishes that information. Another example: investment recommendations are published as buy and sell recommendations, but that is totally wrong. For any stock, there is a price at which it is advantageous to buy it, and a price at which is it advantageous to sell it, and a range in between where you should hold. But no one publishes those price ranges, they just say "buy", "sell" and "hold" as if the price is irrelevant, or on the obviously false assumption that the price when you act on the advice will be more or less the same as the price when they produced the advice. The whole thing is a colossal scam from start to finish.
stcredzero 4y ago
I'm still waiting for someone to implement my idea for the "US Legislative Evil Fund." Basically, it just tracks the stock picks of the 25% of the richest US Senators and Congresspeople and their families. For some strange reason, their portfolios seem to do much better than the S&P 500.
AlbertCory 4y ago
If I'm Jim Cramer: I buy options on a small amount of this, as a hedge against my regular Jim Cramer portfolio going south. What?? He doesn't really do all those investments he recommends? Well, I never.
paulpauper 4y ago
If you want to bet on the inverse of the strategy working, you would want buy puts or short the non-inverse fund, NOT buy the inverse fund . The reason has to do with the mathematics of inverse fund decay. inverse funds of indexes will decay exponentially long term. It has a quadratic decay factor relative to volatility. e^(-at) which a is the volatility and t is the time. to get an idea of what this looks like long-term: https://api.wsj.net/api/kaavio/charts/big.chart?nosettings=1&symb=SH&uf=0&type=2&size=2&sid=2354545&style=320&freq=2&entitlementtoken=0c33378313484ba9b46b8e24ded87dd6&time=20&rand=1647081824&compidx=&ma=0&maval=9&lf=1&lf2=0&lf3=0&height=335&width=579&mocktick=1 https://api.wsj.net/api/kaavio/charts/big.chart?nosettings=1...
atleastoptimal 4y ago
[flagged]
walrus01 4y ago
Speaking of ETFs, anyone find themselves temporarily parking money in HISA ETFs? It's a good way to return close to 5% right now without the time lock in period of a CD. Theoretically should be very low risk unless a bank collapses, although the amount of money that the ETF fund managers place with each underlying bank savings account is obviously way behind FDIC deposit protection.
sytelus 4y ago
May be we should have inverse of all major actively managed funds. Per Buffet theory, this should always outperform market while not having limitations of passive ETFs and much harder to manipulate.
- derf_ 4y ago
  I think you have misunderstood Buffett theory. Most (i.e., more than 50%) of actively managed funds underperform, but in aggregate the amount of underperformance across all funds is roughly equivalent to the management fees they charge. Imagine a bell curve centered around the overall market's returns, but shifted over by a few percent to account for the fees. An inverse of all major actively managed funds will get you the same average performance before the fees (the same as the overall market's), but it won't dip into those managers' bank accounts and transfer their fees to you. It will charge its own fees. So it will underperform, too. The management fee for this ETF, for example, is 1.2% per year.
  - sytelus 4y ago
    I certainly didn't knew that even though >50% of the funds underperform it's only by small margin in aggregate.
s800 4y ago
Call me when there's an inverse A16z
wonderwonder 4y ago
I get the joke and I do think Cramer is wrong a lot but its kind of mean. Imagine your entire identity is wrapped up in being the stock picker guy and someone comes along and invents an ETF that just counter trades you and it outperforms you by a ton. Thats got to be pretty devastating and lead to some serious self doubt. Probably the end of his career too if the ETF consistently outperforms him. He's a public figure making financial advice so more power to whoever invented the ETF, i just see the other side as well.
- mikeweiss 4y ago
  Cramer is a television personality not a stock picker.
- maxerickson 4y ago
  He definitely acts like a clown. Someone gave me one of his books. It has advice like make sure you have disability insurance (loss of work is the #1 financial risk for most people) and max out your tax advantaged accounts in appropriate low cost investments. The "Mad Money" thing is for money left after you cover all that stuff.
- postalrat 4y ago
  What happens when Cramer picks this ETF?
  - wonderwonder 4y ago
    Inception
kqr 4y ago
This seems to be misrepresenting the "blindfolded monkeys" thing. Assuming that equity prices are an unbiased random walk, a blindfolded monkey will on average do exactly as well as anything else. The reason the professional stock picker is a worse choice is they charge you more for their services, and this is where you lose money on choosing them. It seems that unbiased random walk is a fairly good model of short-term equity returns. So no, I don't think "do the inverse of a stockpicker" would on average do any better than just following their advice. Additionally, if the fund charges for their service of maintaining that inverse exposure, it will perform worse in end-user returns.
canucker2016 4y ago
Here's Cramer touting Silicon Valley Bank when it was still at $320 before the run started. https://twitter.com/CramerTracker/status/1634237672997699602 https://twitter.com/CramerTracker/status/1634237672997699602 "I think the fears are not justified SIVB and it's a very compelling situation" about 0:25 into the video Last trade in SIVB before the markets opened on Friday were around $40 so that's about 87.5% down from where Cramer was touting the stock.
lph 4y ago
So if Jim Cramer recommends buying the Inverse Jim Cramer ETF, does it have to sell itself? I'm just asking the important questions here.

417 points by hn8305823 4y ago

https://old.reddit.com/r/wallstreetbets/comments/109cswl/inverse_cramer_i_analyzed_all_21653_buy_and_sell/ https://old.reddit.com/r/wallstreetbets/comments/109cswl/inv... The inverse Cramer analyses on WSB are some of my favorite posts there (although it's a cesspool today so that's not much praise). But yeah, there are actual data-driven strategies to make money by inversing Cramer.

hinkley 4y ago
I’m betting that most people who listen to Cramer aren’t watching his videos the very second the come out, on 2x speed so they can get the tips before they are public knowledge. So effectively he is inciting mob action on stocks, but not in real time. So if you disagree with him and follow him anyway, you have a sort of moral equivalent of insider information. If you sell a stock in the middle of their buying frenzy at least. If you buy a stock the day after he says sell, you can benefit from the market correction when the rest of the cramerless world can’t figure out why TSM dropped five bucks on Monday for no reason, and decide to buy more.

kristjank 4y ago

What a beautiful bag of tomfoolery :D

idlewords 4y ago

If Cramer ever says to buy it, it will segfault the economy.

frob 4y ago
Now my wheels are just spinning over self-shorting funds.
- SparkyMcUnicorn 4y ago
  Essentially what happened with Luna... sort of.
- deleted 4y ago
  [deleted]
pphysch 4y ago
stack overflow seems more likely
CalChris 4y ago
Russell Paradox violation.
- elil17 4y ago
  The Russell 2000 Paradox
- yrdmb 4y ago
  Halting problem.
  - idlewords 4y ago
    Halting opportunity
    - dalys 4y ago
      Halting scheme
__derek__ 4y ago
Ideally, that should net out to an expensive market-neutral fund with 0% expected returns minus the management fees and transaction costs, the latter of which could be really high.
jeron 4y ago
i think it would just count as hedging against his own words
kingTug 4y ago
How the hell is this guy not in jail
- cced 4y ago
  He’s serving someone’s, somewhere’s interest.
  - red-iron-pine 4y ago
    Who owns the channel he's on?
make3 4y ago
stack overflow* the economy
dan-robertson 4y ago
There are actually ETFs that contain themselves (or rather, ETF X is e.g. 10% ETF Y which is 10% ETF X. So long as the total amount of X owned per unit of X is less than 1 (in absolute value), the arithmetic mostly works out. Though I don’t know if any ETFs directly contain themselves.

SuoDuanDao 4y ago

I came across a humorous video of someone getting his fish to invest in stocks https://www.youtube.com/watch?v=USKD3vPD6ZA&t=715s https://www.youtube.com/watch?v=USKD3vPD6ZA&t=715s He was essentially teaching algo trading, and also tracked wallstreet bets sentiment analysis. He went so far as to pitch his investment strategy to serious tech investors (it was ahead of the nasdaq at the time). His Wallstreet bets tracker had been tanking so he focused on the fish investing fund, but I was waiting for one of the investors to suggest he inverse wallstreet bets and make a lot of money.

recursive 4y ago
Fish investing was tanked too.
- SuoDuanDao 4y ago
  not surprising, but I'd bet SWSB would have been going strong in the interim...
- logicalmonster 4y ago
  Was this a deliberate or accidental pun?
  - danuker 4y ago
    I would assume so. You should know that P∨¬P, logicalmonster.
    - layer8 4y ago
      Depends on whether the law of excluded middle holds in your jurisdiction.
      - davrosthedalek 4y ago
        That sounds discriminatory.

dublinben 4y ago

Similarly, an ETF inverse of Cathy Wood’s ARK fund has outperformed quite a bit over the last couple years. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=2021&firstMonth=12&endYear=2023&lastMonth=2&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=ARKK&allocation1_1=100&allocation1_2=0&symbol2=SARK&allocation2_1=0&allocation2_2=100 https://www.portfoliovisualizer.com/backtest-portfolio?s=y&t...

bryanlarsen 4y ago
You can show really poor or really good results for pretty much any high volatility portfolio by cherry picking your time period.
- kristopolous 4y ago
  Over a multi-year time period? Take I dunno, Bitcoin. As you increase the time window, showing a net loss is less and less possible. I'm not a crypto bull and I think it will tend towards zero someday but this is inarguable using current historicals.
  - Eisenstein 4y ago
    As you increase the time window, the possibility that the wallet is abandoned, the wallet owner is dead, or the bitcoins get scammed or lost in a exchange collapse quickly reaches 100%.
    - kristopolous 4y ago
      Sure, but similar properties come with almost any store of wealth. Don't take this as advocacy, it's not. There's plenty of strong arguments against crypto without having to resort to such truisms

digianarchist 4y ago

(2022) Updated story https://www.etftrends.com/2-etfs-offer-inverse-and-long-exposure-to-jim-cramer-stock-picks/ https://www.etftrends.com/2-etfs-offer-inverse-and-long-expo...

gjsman-1000 4y ago

The fact that he still had a job after his 2008 mistake of insisting that Bear Stearns was fine and a safe place to keep your cash, is astounding. That should've been an unrecoverable mistake, especially with how strongly he was certain. "Should I be worried about Bear Stearns in terms of liquidity and get my money out of there? No, NO, NO!!!" (Afterwards... 90% loss in the next 6 days.) https://www.youtube.com/watch?v=gUkbdjetlY8 https://www.youtube.com/watch?v=gUkbdjetlY8

nradov 4y ago
His job is to attract viewers. Not to make accurate stock picks. When I watch a comedy show it's because I find it entertaining, not because I actually take advice from comedians.
- smcl 4y ago
  The comparison to a comedy is a pretty silly one - comedies are pretty explicit about what they are and are pretty clearly not trying to give you financial advice or medical advice or anything like that[0]. Cramer is on a news network and tries to give the appearance of being a financial advice segment, stopping short (likely including the words “this isn’t financial advice” with a little implied wink of). It’s clear to you and I what Cramer’s deal is, but there are plenty of people out there who take him at face value. [0] - there’s sometimes product placement or even a little feel-good message about friendship or family, but rarely if ever anything that looks like actionable advice.
  - kortilla 4y ago
    Comedians that pretend to do news like Jon Stewart or John Oliver are just as harmful. Presenting biased views that shape people’s entire views of society can be much more destructive over a lifetime than bad stock picks. Destroyed family connections because people refuse nuance, non-existent careers because “capitalism bad”, etc.
- lexapro 4y ago
  His show literally starts with "my mission is simple, to make you money".

m3kw9 4y ago

This is nothing more than a money grab to the chat groups that made it popular to note in hindsight that Cramer was wrong. Picking against Cramer is no more different than picking against a random person with random picks, which is like 50/50 except you will pay some ETF fees to do so but you will at least have fun losing money like in casinos

jerf 4y ago
That's the case if Cramer is just an honest guy making his honest picks completely independently, and nobody with any power would even dream of using his platform to do anything untoward, because everyone with any direct or indirect ability to influence him is just so darned honest that they wouldn't dream of exploiting such a large pool of useful reputation. I don't know why I feel I should point this out. I'm sure it's completely true. Don't even know why it would cross my mind to wonder. The financial world is so honest and full of integrity that it's obvious that this is true.
- outworlder 4y ago
  You mean, hypothetically speaking, that Cramer would be gasp paid to promote specific stocks? Maybe when they are in a dire situation (or when insiders know it's going to be pretty bad pretty soon now™)? Yes, that would be bad.
  - kjs3 4y ago
    It doesn't have to be "paid" in any direct way. Cramer is an ex-Goldman Sachs, ex-hedge fund guy. He just needs to call up one of his old buddies and say "hey...Ima gonna tell the rubes to buy FooCorp tomorrow on the show". His buddies profit from knowing that early, and they do something 'nice' for old Jim down the road, like get him an 'exclusive interview' or something he can profit from. It's a racket.
    - linuxftw 4y ago
      The SEC prosecutes people for this type of thing. Much safer approach is to let your buddies buy first, then pump one of them. Lot's of plausible deniability. "Hey, every major fund has some XYZ, I just like the stock right now."

PaywallBuster 4y ago

by the same company who made SARK https://www.trackinsight.com/en/fund/SARK https://www.trackinsight.com/en/fund/SARK The short index of ARKK Innovation ETF by Cathie Wood

deltree7 4y ago

This is designed for gullible people who think Inverse Cramer will beat the market Hint: It won't Hint: Inverse ARK is down 25% YTD and down 40% from peak. tl;dr Memes are not the way to base your investment decision on

BoorishBears 4y ago
SARK seems to have outperformed ARK regardless unless I'm reading the wrong graph (which I might be to be fair) But honestly these meme ETFs aren't meant to be held long term, they're intraday funds. If you read their prospectus, they're charging you a lot to hold it with an expense ratio of 1.06% (compare that to VTSAX at .04%)
- AustinDev 4y ago
  ARK started in 2020 SARK started near ARK's peak so the numbers will appear to favor SARK
  - BoorishBears 4y ago
    SARK was a bet that ARK was overvalued, so they wouldn't have waited for ARK's massive gains to fully evaporate
    - deltree7 4y ago
      If it were a bet that it was overvalued, the minute it reached fair valuation, the ETF should have been dissolved and distributed the funds. The fact that it still exists means, they are happy to collect fees from gullible people who are pro/anti large-internet-personalities.
paulpauper 4y ago
yup that is why buying inverse funds is a bad idea they decay exponentially if you want to bet against Cramer, short the 1x funds or buy puts

wnevets 4y ago

Its surprising he still has an audience after the economic meltdown of 2008-2009.

zwkrt 4y ago
There's few thing people like more than for someone to tell them what to do.
MrMan 4y ago
he called the market then, very well, he told you when to get out, I watched it. he said I just sold my beach house, get flat. I told my friends to get flat the week before.
- wnevets 4y ago
  https://www.youtube.com/watch?v=V9EbPxTm5_s https://www.youtube.com/watch?v=V9EbPxTm5_s > Bear Stearns went under six days later I guess, if you wanna say that is calling it.

ckardat123 4y ago

If anyone is interested, here's a dashboard tracking Jim Cramer's recent stock picks, alongside the stocks' performance since his pick: https://www.quiverquant.com/cramertracker/ https://www.quiverquant.com/cramertracker/

WalterBright 4y ago

This is just an illustration that any stock market "system" contains within it the seeds of its own destruction. This is because if the "system" says "buy", then it must find people willing to sell. If everybody instead rushes to use the "system", then the price of the stock rises to negate the value of the "system". The only way to create a working system is to keep it a secret, and keep your trading volume low enough so that nobody notices what you're doing. Bernie Madoff's "system" worked only because he back dated the trades. Oops.

deleted 4y ago
[deleted]

paxys 4y ago

In order of effectiveness: 1. Buy and hold broad index funds 2. Throw darts at a board to pick individual stocks 3. Be knowledgeable, do your own research, read financial reports, custom build a portfolio 4. Listen to expert advice (Cramer, anti-Cramer and everything else)

rom-antics 4y ago
You forgot: 0. Get elected to Congress
- peanuty1 4y ago
  0. Be Speaker of the House (Nancy Pelosi)
  - mooman219 4y ago
    > If one were to have $100 million invested in the Speaker of the House's stock-picking abilities at the beginning of 2019, the same investment would compound to $192 million as of today, slightly off the November high, when the portfolio hit its peak of almost $309 million. Pelosi's strategy generated a negative year-to-date return of 36.04%, accompanied by a negative one-year return of 36.61%, both slightly underperforming the S&P 500 (SPY). - Q3 2022 I wanted to take a look at this because given stock trades are public you'd think there'd be an ETF to track trades for the speaker of the house, but in reality it seems like people wildly overstate the profitability of their winning trades and understate their losses because "slightly underperforming the S&P 500 (SPY)" doesn't make the same headlines. In the long term, they appear to be no better off than the average portfolio picker.
    - airstrike 4y ago
      The last time I looked into this, the information on trades by members of the congress is delayed. Something like we know in which quarter they traded but not on which exact day, so the ETF doesn't really track their returns

sinerath 4y ago

This guy and the r/cryptocurrency sub pay my car insurance every month. just do the opposite and get rewarded.

anonu 4y ago

old article (oct 2022) and I dont think the ETF ever launched. EDIT: it launched today... Either way - TERRIBLE idea.

elil17 4y ago

>The premise behind SJIM is theoretically sound and can be boiled down to one observation: "the average stock picker performs horribly ." No it is not at all theoretically sound. The biggest issue with stock picking is low volatility. This does not solve that. The other issue is that stock pickers don't do better or worse than a random selection of stocks after adjusting for factor tilt. That means stock pickers can't do better than average, but they also can't do worse than average - so the whole premise makes no sense if you actually buy into the idea that stock picking doesn't work.

vanattab 4y ago
>That means stock pickers can't do better than average, but they also can't do worse than average. Not True. In fact virtually all stock pickers will do better or worse then the average. What you mean to say is the "average" stockpicker can't do better or worse then the average but that is of course a tautology.
- elil17 4y ago
  What I actually mean is that 99.999% stock pickers can't intentionally do better or worse than average. And the tiny fraction who can are fund directors who are flooded with so much capital that they generate sub-1% alphas (which they eat up with their own fees).
  - Ekaros 4y ago
    Wouldn't it be possible to do worse? I think there should be enough opportunities to pick up true losers or almost dying companies. I'm not saying you could extract profit for those situation as there are too many other people trying to do it. But losing money should certainly be possible.
    - elil17 4y ago
      A few factors here: 1. You could try to do worse than average, and you'd succeed, but only because of the skewness of individual stock performance. You'd be no better than random chance at picking losers, it'd just be that most stocks are losers. 2. Factor-correction means the strategy of "choosing dying companies" won't work (e.g. in the Fama and French five factor model a dying company would an outlier in terms of high-minus-low, robust-minus-weak, and probably conservative-minus-aggressive).

diebeforei485 4y ago

We need an inverse Scott Galloway index as well.

ursuscamp 4y ago

The SEC will allow joke and meme ETFs, and triple leverage commodity ETFs, but a normal, non-leveraged Bitcoin ETF? No, we have to protect investors from that.

chollida1 4y ago
The SEC's reasoning for not allowing a spot BTC ETF is that you can't trust the markets it trades on and more importantly for them, they can't go and subpoena the trader information from, say Binance, if they think there is market manipulation going on iwth the spot price of BTC. They can do that with leveraged and meme ETF's so those same reasons don't hold.
- drexlspivey 4y ago
  can’t they just have it track the price on regulated american exchanges only?
TheCoelacanth 4y ago
The SEC's job is to stop you from being defrauded, not to stop you from making stupid investment decisions.

chollida1 4y ago

I'm not the biggest Jim Cramer fan but he ran a successful hedge fund and has been in the industry for 20 years. He is an expert and knows what he's talking about and is pretty knowledgeable about the US cash equities markets. Part of the inverse Kramer ETF's success is that if you run a hedge fund you can make bank on 20 positions over a year or two. If you are on TV every night you need a new "winner" 5 times a week, which just isn't possible.

throwaway29812 4y ago
So because he tricked people into paying fees while performing more or less what the market does, he's an "expert"?
- chollida1 4y ago
  > So because he tricked people into paying fees while performing more or less what the market does, he's an "expert"? Who do you think was tricked into investing with him? His fund did well, not sure how you are imagining an investor is being tricked into investing in a successful hedge fund? Can you elaborate on that? His returns according to wikipedia beat the market so again, I'm confused as to where you figure he did what the market did.
  - throwaway29812 4y ago
    Most funds don't beat the market in the long term, what's the sample size you are using? If he was so successful, why did he stop?
- MrMan 4y ago
  his fund did well, but he is in a different business now, he is a TV personality.
hn8305823 4y ago
> he ran a successful hedge fund https://www.youtube.com/watch?v=r07Gg92YjOI https://www.youtube.com/watch?v=r07Gg92YjOI

VLM 4y ago

If you're bored and into financial "stuff" look up the returns of the typical ESG sector fund, then compare the return to the "YALL" ETF. I still laugh at the ticker symbol for "YALL". Sometimes you just can't make this stuff up. The analogy with the inverse cramer fund is pretty obvious as YALL is pretty much a reverse ESG fund "more or less much hand waving here".

esaym 4y ago
Buying.
BenSahar 4y ago
It's not really a reverse ESG fund. It just removes companies that have made perceived left-wing statements. An inverse ESG fund would be to use the inverse weighting of an ESG fund. Also, 25%+ of YALL is TSLA + NVDA + BA.

crazygringo 4y ago

This is really funny. But at the same time it reminds me of a certain type of World Cup bet, where you win mega $$ if you correctly pick the winners of all 64 matches. But you also win the same mega $$ if every single one of your picks loses, which of course is just as hard to achieve. (I forget how they handle ties but you get the idea.) All of which is to say, if Jim Cramer has no expertise in picking stocks, investing broadly in his picks is not much different from an index fund, you'll just roughly track the market. Whereas if he actively gets you to consistently and reliably lose money on high-volume publicly traded investments, then that's still (counterintuitively) a signal that somehow he knows something.

danicriss 4y ago
Relevant XKCD https://xkcd.com/2270/ https://xkcd.com/2270/
KMag 4y ago
> somehow he knows something and/or his public predictions influence the markets I'm pretty sure multiple data vendors compete to sell low-latency feeds of his picks, given his popularity. If a Cramer-tracking ETF underperforms the market, it's entirely possible that the ETF enters the market late (after the market has mostly priced in the Cramer-bump) and holds during the reversion to the mean. Though, I haven't looked into it. This is not investment advice.
idlewords 4y ago
I think it works more like a law of thermodynamics, where no matter how you arrange the elements or what signs you flip, whether you follow his advice or inverse it, any stock betting system based on Jim Cramer is guaranteed to lose money.
hedora 4y ago
There was an NLP based trading firm about 10 years ago that would run sentiment analysis over articles from industry analysts. According to someone that worked there, some of the most useful signal came from analysts that had strong negative correlations with future performance.

locallost 4y ago

There was an Inverse Galloway Index (although not an actual fund I think) that saw some fat returns when there was a seemingly unlimited money supply, but if you had invested in it a year and a half ago you would be deep in red. Over a period of a year or two nobody knows anything, possibly even in general. So can't blame Cramer too much. On the other hand there's no reason to listen to him either.

lisper 4y ago

> their earlier Short Innovation Daily ETF (SARK) that bet against Cathie Wood and her funds is still up 73% year-to-date. Only because this article was written in October of last year. Since then SARK is down 30% (along with the rest of the market). You can tell that the entire investment services industry is totally fucked up simply by the form of the information they put out. Investment returns calculated over a single time period is a case in point. What you really want to know is the expected value of the return given random entry and exit dates, but no one publishes that information. Another example: investment recommendations are published as buy and sell recommendations, but that is totally wrong. For any stock, there is a price at which it is advantageous to buy it, and a price at which is it advantageous to sell it, and a range in between where you should hold. But no one publishes those price ranges, they just say "buy", "sell" and "hold" as if the price is irrelevant, or on the obviously false assumption that the price when you act on the advice will be more or less the same as the price when they produced the advice. The whole thing is a colossal scam from start to finish.

stcredzero 4y ago

I'm still waiting for someone to implement my idea for the "US Legislative Evil Fund." Basically, it just tracks the stock picks of the 25% of the richest US Senators and Congresspeople and their families. For some strange reason, their portfolios seem to do much better than the S&P 500.

AlbertCory 4y ago

If I'm Jim Cramer: I buy options on a small amount of this, as a hedge against my regular Jim Cramer portfolio going south. What?? He doesn't really do all those investments he recommends? Well, I never.

paulpauper 4y ago

If you want to bet on the inverse of the strategy working, you would want buy puts or short the non-inverse fund, NOT buy the inverse fund . The reason has to do with the mathematics of inverse fund decay. inverse funds of indexes will decay exponentially long term. It has a quadratic decay factor relative to volatility. e^(-at) which a is the volatility and t is the time. to get an idea of what this looks like long-term: https://api.wsj.net/api/kaavio/charts/big.chart?nosettings=1&symb=SH&uf=0&type=2&size=2&sid=2354545&style=320&freq=2&entitlementtoken=0c33378313484ba9b46b8e24ded87dd6&time=20&rand=1647081824&compidx=&ma=0&maval=9&lf=1&lf2=0&lf3=0&height=335&width=579&mocktick=1 https://api.wsj.net/api/kaavio/charts/big.chart?nosettings=1...

atleastoptimal 4y ago

[flagged]

walrus01 4y ago

Speaking of ETFs, anyone find themselves temporarily parking money in HISA ETFs? It's a good way to return close to 5% right now without the time lock in period of a CD. Theoretically should be very low risk unless a bank collapses, although the amount of money that the ETF fund managers place with each underlying bank savings account is obviously way behind FDIC deposit protection.

sytelus 4y ago

May be we should have inverse of all major actively managed funds. Per Buffet theory, this should always outperform market while not having limitations of passive ETFs and much harder to manipulate.

derf_ 4y ago
I think you have misunderstood Buffett theory. Most (i.e., more than 50%) of actively managed funds underperform, but in aggregate the amount of underperformance across all funds is roughly equivalent to the management fees they charge. Imagine a bell curve centered around the overall market's returns, but shifted over by a few percent to account for the fees. An inverse of all major actively managed funds will get you the same average performance before the fees (the same as the overall market's), but it won't dip into those managers' bank accounts and transfer their fees to you. It will charge its own fees. So it will underperform, too. The management fee for this ETF, for example, is 1.2% per year.
- sytelus 4y ago
  I certainly didn't knew that even though >50% of the funds underperform it's only by small margin in aggregate.

s800 4y ago

Call me when there's an inverse A16z

wonderwonder 4y ago

I get the joke and I do think Cramer is wrong a lot but its kind of mean. Imagine your entire identity is wrapped up in being the stock picker guy and someone comes along and invents an ETF that just counter trades you and it outperforms you by a ton. Thats got to be pretty devastating and lead to some serious self doubt. Probably the end of his career too if the ETF consistently outperforms him. He's a public figure making financial advice so more power to whoever invented the ETF, i just see the other side as well.

mikeweiss 4y ago
Cramer is a television personality not a stock picker.
maxerickson 4y ago
He definitely acts like a clown. Someone gave me one of his books. It has advice like make sure you have disability insurance (loss of work is the #1 financial risk for most people) and max out your tax advantaged accounts in appropriate low cost investments. The "Mad Money" thing is for money left after you cover all that stuff.
postalrat 4y ago
What happens when Cramer picks this ETF?
- wonderwonder 4y ago
  Inception

kqr 4y ago

This seems to be misrepresenting the "blindfolded monkeys" thing. Assuming that equity prices are an unbiased random walk, a blindfolded monkey will on average do exactly as well as anything else. The reason the professional stock picker is a worse choice is they charge you more for their services, and this is where you lose money on choosing them. It seems that unbiased random walk is a fairly good model of short-term equity returns. So no, I don't think "do the inverse of a stockpicker" would on average do any better than just following their advice. Additionally, if the fund charges for their service of maintaining that inverse exposure, it will perform worse in end-user returns.

canucker2016 4y ago

Here's Cramer touting Silicon Valley Bank when it was still at $320 before the run started. https://twitter.com/CramerTracker/status/1634237672997699602 https://twitter.com/CramerTracker/status/1634237672997699602 "I think the fears are not justified SIVB and it's a very compelling situation" about 0:25 into the video Last trade in SIVB before the markets opened on Friday were around $40 so that's about 87.5% down from where Cramer was touting the stock.

lph 4y ago

So if Jim Cramer recommends buying the Inverse Jim Cramer ETF, does it have to sell itself? I'm just asking the important questions here.