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Cramer's Spot Stock Before Herd Does Post Reply Rate topic
giantlow Master	15-Jan-2007 23:19        giantlow About Contact  Quote this Post!
x 0   x 0  Alert Admin	now with all the alternative fuels coming up. i think those investing in alternative fuels like Celestial wld benefit more compared to traditional oil companies.
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billywows Elite	15-Jan-2007 23:10        billywows About Contact  Quote this Post!
x 0   x 0  Alert Admin	With oil at USD 53.00 a barrel now, oil related stocks are pretty attractive so long as oil does not fall farther, Giantlow ....  If it hits USD 75.00 again in next 6 months, you would say "Shiok"! Everything is so high now .... but oil is low. Isn't it good to spot an oil buy early now before the Big Boys jump in later to push oil stock higher when oil price chiong ?! (*Caution: Above meant to capture the meaning of the posted article to buy before the crowd. Beware that oil may drop further or goes up ... )
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giantlow Master	15-Jan-2007 22:59        giantlow About Contact  Quote this Post!
x 0   x 0  Alert Admin	thanks for the interesting read, billywows the part about owning oils, doesn;t seem to ring true for now eh?
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billywows Elite	15-Jan-2007 22:43        billywows About Contact  Quote this Post!
x 0   x 0  Alert Admin	A recap of my favorite post: "Buy before the Big Boys!" This is my trading style ..... Happy reading :)
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scotty Senior	05-Aug-2006 22:35        scotty About Contact  Quote this Post!   Mood:
x 0   x 0  Alert Admin	thanks! funny!
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billywows Elite	05-Aug-2006 18:31        billywows About Contact  Quote this Post!
x 2   x 0  Alert Admin	Everyone listens to this guy Jim Cramer in US cos he can spot good stocks early ..... Another interesting read below! ------------------------------------------------ Cramer's 'Mad Money' Recap: Spot Moves Before Herd Does By TheStreet.com Staff 8/4/2006 7:02 PM EDT Wall Street is an "embarrassingly unsophisticated" place where the real money is made by daring investors who predict the tastes of crowds, Jim Cramer said on his "Mad Money" TV show. "You need the stupid, unthinking greed of everyone out there to drive stocks up -- stocks that you were in early," Cramer advised viewers. While buy-and-hold strategies will yield a market return, beating the market involves finding obscure stocks that will later find favor with the mob. "If you're only willing to buy and hold, then you're too lazy to be in this game," Cramer said. "To beat the market you have to know where it's going before it gets there." Cramer said he's earned the contempt of some investors for riding the dot-com craze to its zenith "before getting my butt out of there." But "no stock is overvalued if it's going up." What to Buy: Don't look for momentum names is analyst reports, the S&P 500 or most of the financial press, Cramer said. Look in message boards, Investor's Business Daily and the Nasdaq percentage-gainer list. Cramer offered the example of an investor trying to game nanotech. "You're not going to look for a good nanotech company. You're going to look for the least bad one. Science that sounds just legitimate enough to get the crowd behind it." "Once you're in, if you're right, the soon-to-be-hot sector will start getting coverage," he said. "Brokers will promote this garbage, then it will soar." When to Sell: Saying when to sell is more important than when to buy, and Cramer offered a list of signals he looks for in stocks that are topping out. He mentioned creeping competition, accounting problems, overexpansion and government interference, among other things. Again, Wall Street analysts are no help. "Downgrades happen most often after the train has left the track," he said. "Once it's burned, it's finished, gone, destroyed." A)  The encroachment of competition is responsible for 70% of stock "tops," Cramer said, a notable example being U.S. Surgical in the mid-1990s. You had to own the stock, went the Street's mantra, because of its dominance in the surgical staples sector. "That is until Johnson & Johnson (JNJ - commentary - Cramer's Take) announced it was getting into the business. USS went from $120 to $30 and I shorted every share I could get." "Always assume someone can come in and make your company's product for less." B)   Investors should bail at the first sight of accounting shenanigans, Cramer said. "You must shoot first, and don't even bother asking questions." Cramer copped to ignoring the advice and getting burned on Nortel (NT - commentary - Cramer's Take). C) Overexpansion stresses management's time and money, while any reference to "integration problems" like those experienced at Enron and the old Time Warner (TWX - commentary - Cramer's Take) are reasons to "run for the exits." "Look out when a retailer has too many stores near each other," Cramer said. "When a retailer has stores in every state in the union and has no new places to expand, that's the ultimate top." Cramer's 10 rules of thumb: Cramer offered several rules of thumb for profitable investing including proper diversification and the use of discretionary funds for an active stock portfolio. Do not play with money that you need. And do not play with retirement money. Here are his 10 rules for building a portfolio.  No. 10: Buy a stock that is a stock for the future. Call it your nontech hope stock, he said. No. 9: Pick a retailer, preferably a regional retailer that still has plenty of growth ahead. No. 8: You need some technology to have a diversified portfolio. Intel (INTC - commentary - Cramer's Take) would be a good start. No. 7: You need a cyclical name. Dow Chemical (DOW - commentary - Cramer's Take), Deere (DE - commentary - Cramer's Take), Caterpillar (CAT - commentary - Cramer's Take) and Boeing (BA - commentary - Cramer's Take) are examples. No. 6: Own a secular stock -- a soft-goods stock such as Procter & Gamble (PG - commentary - Cramer's Take), a Kellogg (K - commentary - Cramer's Take) or a Johnson & Johnson (JNJ - commentary - Cramer's Take). No. 5: Own one speculative stock. Something you think is a winner, though. You have to do your homework on this one. No. 4: Hold one financial. Own your local bank. Cramer owns Commerce Bancorp (CBH - commentary - Cramer's Take), a regional bank near his home. No. 3: Own a brand-name blue chip. No. 2: Oils. A must-have. They're consistent performers. And they have high yields. And the No. 1 tenet in Cramer's tool kit: Pick a company that you know. You want to have an edge. Perhaps one of your pals works there. Local knowledge gives an investor an edge. Cramer offered an understanding of how different businesses perform during different economic cycles. "Fifty-percent of how a stock moves depends on the performance of the sector it's in," Cramer noted. "If you call the sector, you can call half the gains or losses in a stock." Cramer differentiated between the two main categories of stocks -- cyclicals, which do well when the economy is doing well, and secular growth, which aren't sensitive to the underlying strength of the economy. The first category includes airlines, autos, raw materials and heavy equipment, while the second includes consumer staples because "we don't stop buying Band-Aids just because we're short of cash." Cramer mapped out one counterintuitive investment strategy that consists of buying cyclicals when their price-to-earnings ratios are highest. The wide P/Es reflect the frantic effort of analysts to lower earnings estimates, he said, but that generally happens once the stocks have stopped going down. "When these companies are at their most expensive at the bottom of the cycle, that's when you have to buy."
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