Is Jim Cramer crazy?
Well, we know the answer to that question. So here’s another: is it worth following his advice when he screams BUY or SELL on CNBC?
Research shows his advice is pretty good. NPR’s Planet Money reports that a study of Cramer’s recommendations from 2005 to 2007 shows investors who followed his advice would have a 12% return. That compares to a 7% return in the same period for investors who simply tracked the S&P.
So, should we all get onboard with Cramer? NPR’s David Kestenbaum says maybe not. There’s this little thing called risk. The report’s most memorable line: You can get somewhere faster by driving 100 miles an hour. But you’re taking on greater risk that you’ll hit a tree.
