Declines in the market are not always as they appear. And if you don't understand what's actually happening, Jim Cramer fears you could stumble badly.
The declines would suggest that Time Warner and CBS have encountered some kind of business-related headwind.
"I've been asking everyone, is Time Warner going down because it was supposed to get a bigger dividend from Time Inc? Is CBS getting hit because Letterman is retiring?"
However, after digging down in the market, Cramer thinks the declines are about something else altogether; hedge fund redemptions.
"Recently Coatue Management, a $7 billion hedge fund I have never even heard of, said it was going to return $2 billion to investors because of the volatility among its holdings. To me that's code for our positions went against us and we've been laid to waste, However, peel back the onion and you'll find CBS and Time Warner are the firm's first and third largest positions," Cramer said.
In other words, although you might be inclined to think bad fundamentals were driving the price action in Time Warner and CBS, instead, declines were due to niche issue involving a hedge fund.