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Road Rules
Road Rules Video Gallery
Investing can be confusing. Luckily, Cramer has mapped out some road rules for all you Home Gamers trying to navigate the jungle that is Wall Street. Think of it as "Mad Money 101" –- some fundamental advice to keep in mind as you play the market. Whether you're a first time investor or a seasoned financier, it's always good to remember the basics.
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Aug.28
6:36 PM ET
Thursday, 28 Aug 2008
Moving With the Market

If you’re going to watch Mad Money effectively, you have to know that Cramer is going to change his mind often. That’s because the market is dynamic and things are constantly changing, so his opinions will change, too. You can’t rely on five hours of television a week to tell you exactly what you should buy, exactly when you should buy it, and then exactly when to sell.

After a certain point, you’re on your own. This is why Cramer emphasizes homework. He recommends one hour per week per stock you own. If you do your homework, you’ll probably make a whole lot more money.

Besides, it would be reckless and irresponsible for Cramer not to change his mind about stocks. He says there are very few of them that are worth holding for longer than 18 months – and even that’s a stretch. It’s best to take profits when you have them rather than risk losing what you’ve gained. The reasons he gives for buying a stock are always contingent on those reasons holding true. So if he’s changed his mind, it’s because the situation has changed. Once the market switches direction, investors need to as well.

Bottom Line: Cramer doesn’t deliver eternal truth on this show, and he often changes his mind. If you want to watch this show the right way, you need to understand the radical contingency of every recommendation he makes. Even the best stocks are fragile, and you always have to stay flexible.





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