With great success: no one gets it wrong as often as stock legend Jim Cramer. Now a fund is betting against its forecasts

Jim Cramer recently broke through a threshold that was new even for him: The author and presenter cried on television.

With great success: no one gets it wrong as often as stock legend Jim Cramer. Now a fund is betting against its forecasts

Jim Cramer recently broke through a threshold that was new even for him: The author and presenter cried on television. The man who thrives on live emotional outbursts and whose emotionality is the main reason he watches CNBC's Mad Money show has never had tears in his eyes before. The reason was that the quarterly figures from the Facebook group Meta were much worse than they had forecast. Cramer was wrong in his assessment – ​​again. And he tearfully apologized to his viewers. Nothing new for his numerous critics. They say that he shouldn't be able to stop crying if he meant it honestly. Which they are far from wrong about.

Just two of many examples: Cramer predicts hard times for the crypto platform Coinbase, after which the share increases in value by 50 percent. Netflix was a buy for him at the peak, then it went downhill. A few years earlier, he advised investors to sell HP, and the stock soared beyond belief -- many have never forgiven him. And so forth. People on Reddit and Twitter are asking, "Why isn't he hosting 'Dumb Money'?" someone wants to know. And: "Why is he even allowed to be on TV?" Another: "It's amazing how wrong a single person can be."

One thing should not be forgotten: Cramer definitely has the credentials. He attended Harvard and graduated magna cum laude, where he was also the editor-in-chief of the newspaper "The Harvard Crimson". He has written several bestsellers. In the 1980s he started a career as a trader at Goldman Sachs in New York, and a few years later he launched his own fund. In the early internet age, he founded the long-defining financial website thestreet.com and later sold it for over $15 million. At his best, half a million people in the USA watched him in front of the television. Even if he likes to consciously make himself into a full horst: the man is not a total air number. The only problem is that all the highlights were all a long time ago. The impression is spreading that Cramer has massively lost touch with the present.

And that's exactly what an exchange-traded fund has been trying to take advantage of for a few months: the Inverse Jim Cramer ETF. The investment prospectus states: "Under regular conditions, at least 80 percent of the fund's investments should be invested contrary to Cramer's advice." Since Cramer communicates his picks via "Mad Money" on CNBC and especially Twitter, the inverse Jim Cramer can react to them in real time and short or long the respective positions. The portfolio should consist of 20 to 25 equally weighted positions. It serves from the US market as well as international markets. Behind the idea is Matthew Tuttle, a busy money manager who founded Tuttle Capital. He already attracted attention in November 2021 when he launched the Tuttle Capital Short Innovation ETF. Its function is to short the positions of Cathie Woods Ark Innovation ETF.

A small sensation at the time: Wood's heyday was only a few months ago, and she continued to focus on tech stocks, even if they were starting to collapse at the time. Inverse ETFs are actually nothing new and not uncommon, especially in bear markets. However, Tuttle's anti-Wood ETF made more headway when the markets began to smear, which was also due to Wood's immense popularity - and the founder saw a successful principle that can also be applied to other personalities. So why not hang on to the loudest, most prominent, and most obvious of them all - Cramer? Over 150,000 accounts are now following the Inverse Jim Cramer ETF on Twitter, which since Elon Musk's takeover and parody law has had to include "(Not Jim Cramer)" in its name. Each recommendation from Cramer is retweeted with the appropriate contrary recommendation. An update from the end of October states that the ETF's performance has exceeded all expectations even in this "difficult year". Disney, Starbucks, Microsoft, Amazon and General Electric, among others, are shorted – all good growth candidates for Cramer.

Incidentally, the curse also works in other areas: In the playoffs of the US baseball championships between Philadelphia and Houston it was recently a tie when Cramer confessed to being a Phillies fan. Consequently, the last three games were lost - and with them the championship. But now it gets interesting. Because Cramer has slowly realized that more and more people are relying on his inability. He recently tweeted a prognosis, followed by another tweet with a wink smiley: "Am I really serious?" A new cat-and-mouse game emerges: what else is serious advice? What is deliberate deception to get back at the dishonorable ETF? Cramer is now 67 years old, despite all malice he is a living legend. You can also tell by the fact that the hostilities become less hateful. Cramer is just about to enter the late Rudi Carrell phase, in which people are simply allowed to do their thing and are regarded more as institutions that give peace of mind than as actual experts who still have great news to tell the present. Just before Thanksgiving, he wished everyone a happy and safe holiday, including the many naysayers.

Perhaps a look into mythology is the solution: as is well known, the oracle of Delphi remained vague. Let the people explain everything. It's just that Cramer just wouldn't be Cramer anymore. And that would not only be a shame for those who are currently getting wealthy thanks to cheeky contrarian picks. But for all of us who actually fell in love with the energetic stock show clown at some point.

This text first appeared here on Finance Forward.

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