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Cramer: The stocks that could trigger a rally

As most investors know, the success of a stock often depends on the strength of the company's leader. But Jim Cramer said the same goes for leadership stocks in the market—all it takes is one stock move to trigger buying all over the place .

"Some leaders have real pin action, and they can give you a spare or a strike far more easily than others," the "Mad Money" host said.

One of the groups on Cramer's radar that tend to trigger buying is the transports. He always knows that when the trains, planes and trucks are doing well, commerce is doing well. And more commerce means there are more passengers who are spending more money.

Unfortunately, transit stocks have not been doing very well lately, as the price of oil has dampened some of the return.





Netflix
Jonathan Nackstrand | AFP | Getty Images

The second key leadership group is the banks. Many banks are making serious money from an increased amount of lending. So, banks rallying indicates more lending. But Cramer doesn't see this group rallying either.

"You need to have either strong lending or a decent net interest margin on the deposits, and currently it looks like we might not have either, as interest rates haven't gone up," Cramer added.

The third group is technology stocks, which has been up and down. The good news is that there are some clear leaders within tech. Bad news is that, in Cramer's perspective, these stocks aren't really qualified because they tend to be disruptive and don't have many followers.

For example, Netflix was on fire on Tuesday because a few analysts had positive commentary on it. Cramer remained unimpressed, though.

"The issue with Netflix…is that it doesn't inspire any other stocks to rally. Netflix disrupts everyone else," Cramer said.

Then there was Google. Cramer has seen in the past that when Google goes higher, that means it will kill off all of the other companies. He considers it to be the worst kind of leadership possible, as it has already wrecked and destroyed the advertising business and online media companies with its programmatic ad selling that prevents others from profiting.

That means bye, bye Yelp, TripAdvisor, Yahoo and AOL.

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Or how about Facebook? Many think that this is a great leadership stock, but Cramer has only seen that the promotions featured on Facebook have destroyed value at other companies.

So, while there are many groups that Cramer wants investors to watch for triggers to buying, he warned to steer clear of the these fast-growing technology leaders. Those stocks tend to leave a trail of wreckage behind them at any cost to climb the top of the S&P 500 ladder.

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