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The most important lesson Jim Cramer has learned on 12 years of 'Mad Money'

Elizabeth Gurdus

During the last 12 years on " Mad Money ," here is the most important lesson Jim Cramer has learned: "Teach more and pick less."

When Cramer started as the host of "Mad Money," he said the show was a stock-picker's paradise in a raging bull market.

But as the show evolved, Cramer realized viewers wanted to hear more about how to analyze stocks — dive deep into the underlying companies and technical data to understand why they move the way they do.

"These days we pick them almost as metaphors to show you how big money decides what to buy and what not to buy. We do segments like 'Off the charts,' something we didn't do at the beginning, because we want to show you how big institutional money managers think and how we can track their moves," Cramer said.

Cramer, a former money manager and host of radio show "Real Money," also learned to push viewers to diversify their portfolios. Even professional investors can fall victim to bad bets, he said.

"We simply don't want a single stock or a single sector wrecking your entire portfolio," Cramer said.

It is also critical to diversify beyond stocks, Cramer learned. "We don't want you buying individual stocks until you've put away some money in an S&P 500 index fund, so we know for sure that you're diversified," he said.

In fact, Cramer stood by his advice that your first $10,000 should be put into index funds and any money that you can afford to take a hit on can go into your "mad money portfolio."

Cramer's final lesson after 12 years on the job is that viewers love digging into individual stocks, so he has developed techniques to help guide stock-pickers through the ups and downs.

"You want to learn how they work, how to pick the best ones, how to avoid the worst ones," Cramer said. "So I developed multiple rules that can help you avoid the losers. I've pitted bulls and bears together to try to get your conviction high enough so you won't sell the stock when it goes down."

Cramer has followed individual stocks based on the brands his kids know and love, the show's countless CEO interviews, plus technical chart analyses like this one for Facebook, Apple and Tesla .

Cramer's bottom line: "It's been 12 years since we started this one-man show about business, and it's been quite a run. I could say it's because we've always been trying to find that bull market, but truth is that you are the real reason we keep doing this, and we intend to continue for many more years to come."

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