Cramer dissected by eggheads

[stock777]

In my role as public servant and repentant ex-Cramer supporter, I offer this recent paper that tells you all about how Mad $ watchers are being systematically relieved of thier funds.

The study has flaws but its an interesting read.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=870498#PaperDownload

 

[Hydroblunt]

I think Livermore stated it best when he said that the best thing the public can do is stop listening to the media if they want to make money in the markets.

 

[Free Thinker]

i like this part: http://www.cramersmadmoney.com/showthread.php?t=2709
Our analysis provides evidence of the following:

(1) There is a statistically significant run-up in price even before Cramer recommends the stocks on air which suggests information is leaking out before the recommendations are made.

 

[maxpi]

and

our GMM estimates of the components of the bid-ask spread suggest that market makers are aware of Cramer's recommendations and anticipate the order flow imbalance following Cramer's recommendations.

It's a big party and Cramer is the DJ

 

[dividend]

Quote from maxpi:

and

components of the bid-ask spread suggest that market makers are aware of Cramer's recommendations and anticipate the order flow

interesting

 

[nitro]

Quote from stock777:

...

The study has flaws but its an interesting read.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=870498#PaperDownload

Of course that is true. I know traders that are providing the liquidity to Cramer followers in the after hours and licking their chops.

I have watched a few of Cramer's shows so I am not an expert by any means on his usefulness or not to the small investor, although I believe that he is very useful to them. But while I think that it is foolish to jump on Cramer's recommendations from a trade point of view (and especially the people that drive a stock up dollars at a time in the after hours), imo those that listen to the thinking process that he verbalises can be very useful as a starting point for research.

Finally, it seems he brings in Herb Greenberg only occassionally. If every recommendation Cramer made was given the same debate with Herb and not just the little blurb at the end of the show, it would be worth it ten times over for the trader. Thing is that Herb is narrow and deep in his knowledge, while Cramer is wide and shallow in his.

nitro

 

[Free Thinker]

Quote from nitro:

Of course that is true. I know traders that are providing the liquidity to Cramer followers in the after hours and licking their chops.

I have watched a few of Cramer's shows so I am not an expert by any means on his usefulness or not to the small investor, although I believe that he is very useful to them. But while I think that it is foolish to jump on Cramer's recommendations from a trade point of view (and especially the people that drive a stock up dollars at a time in the after hours), imo those that listen to the thinking process that he verbalises can be very useful as a starting point for research.

Finally, it seems he brings in Herb Greenberg only occassionally. If every recommendation Cramer made was given the same debate with Herb and not just the little blurb at the end of the show, it would be worth it ten times over for the trader. Thing is that Herb is narrow and deep in his knowledge, while Cramer is wide and shallow in his.

nitro

cramer only brings greenberg on to ridicule him and any bears.

 

[nitro]

Quote from vhehn:

cramer only brings greenberg on to ridicule him and any bears.

Sorry I strongly disagree with that. But again, I have not watched the show that many times so I do not speak from a solid experience.

But in the shows that I did watch that Herb was brought in, that did not seem the case to me at all.

nitro

 

[kowboy]

Does not the study show there is a marked statistical edge shorting the recomendations on day one?

Mike

 

[AAAintheBeltway]

Why don't they just have David Rocker come on to bash stocks and dispense with the handpuppet Greenberg? He's an annoying liitle creep who has never traded a stock in his life. At least have someone who has done the work, not someone who has memorized talking points.