and how you can make money shorting his reccommendations. basically, people just RE-ACT to his buys and sells, so you could make money with the pop and drop.
Selling Cramer short Our question is: How are viewers supposed to know that they should pay attention only to this subset of stock picks each week and ignore the thousands of others that Cramer makes on his show?
Then there's the day-after-pop phenomenon. Our analysis of Cramer's picks over the past two years, from YourMoneyWatch, showed that, on average, the stocks jumped 2% the day after he mentioned them. From there, they usually moved sideways or down for the following 30 trading days. This offered an opportunity to make money -- 5% to 30% a year -- by selling Cramer's selections short.
Cramer agrees that there is a shorting opportunity in the temporary effect he has on stocks -- a trade that he'd jump on if he still were at a hedge fund. "If you short the bump, you will do well," he said last week. "I've said it on the show many times."
>i have almost 80 contracts shorting calls and buying puts. i currently hold 20, nov 300 puts, some nov 270, jan 320 puts, sold over 30, 300 calls... yeah, you could say i put a fortune in shorting cmg. i think your nov 300 puts will fine (i have 20 of these).