We love Jim Cramer (seriously). We read his book ‘Getting Back To Even’ which was released just after the financial crisis, and we were amazed at how well he authored some good practical advice based on strategies that larger funds use. He even included a great chapter on stock options that went down like a spoon full of sugar… Jim Cramer really does look out for the small investor, and that’s gold.
Today we decided to have some fun and run the algorithm on some of his stock calls from last week. We used the screener on thestreet.com and came up with just over 30 stocks in the universe. The results were impressive: Of all his calls, the computer agreed with about 90% of them in terms of trend. But there were some that did not agree – one of these was 1-800-Flowers (NASDAQ:FLWS). Cramer called ‘Sell’ on Sept. 13, and our algo generated a BUY signal on September 18 as the stock hovered around the same price levels.
Far be it from us to go against Mr. Cramer, a person we have come to greatly respect – so we re-ran it again and did indeed validate the algo’s Buy signal.
We are adding this call to our performance tracker, but only taking a small position as it is contradictory from ‘The Cray’ (as he is affectionately known around here). In algorithmic terms we have assigned an extremely low confidence rating out of 10 which reduces the exposure on the trade, as we are torn between wanting to be right and wrong on this signal.