Betting against Jim Cramer's small-cap stock picks is a highly profitable strategy that beats the market.
April 26, 2026
Original Paper
What Cramer Holds vs What He Recommends: Signal-Time Features in 16,701 Mad Money Recommendations (2018-2024)
SSRN · 6643379
The Takeaway
Small-cap stocks recommended on the show Mad Money significantly underperform the S&P 500 when the host has no personal stake in them. The inverse Cramer effect is a real empirical phenomenon rather than just an internet meme. Most viewers believe that televised financial advice provides a useful signal for making money. This data proves that these recommendations are actually a contrarian indicator for smaller companies. Investors can generate high returns by simply doing the opposite of what the show suggests for these specific stocks.
From the abstract
We study 16,701 long stock recommendations from Jim Cramer's CNBC Mad Money (January 2018-December 2024) and ask which signal-time features and prior-disclosure states separate the recommendations that subsequently beat the S&P 500 from those that don't. Forward returns are measured at one-, three-, six-, and twelve-month horizons against the same-window return of the SPY ETF. Because Cramer frequently returns to the same names-NVDA alone is recommended 179 times-we first group repeated ment