Getting Defensive with Jim Cramer

In this tough environment, Cramer on Monday recommended investors get defensive. The "Mad Money" host said to look for stocks that have a high dividend yield, as well as an attractive risk-reward.

Take Microchip Technology , for example. It is a semiconductor manufacturer, which primarily makes microcontrollers or chips that go into simple electronic devices. Its 4.5 percent dividend yield is the highest in all the semiconductor space.

(RELATED: Cramer's Top Dividend Stocks 2011)

Cramer recommends investors do their homework on this stock and start buying share when the stock drops to a 5 percent yield. And he thinks the stock does have further to fall. It's barely a point off its 52-week low. Expectations are so low, Cramer thinks Microchip should be able to beat them.

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com

Contact Mad Money

  • Showtimes

    Monday - Friday 6p ET
    Saturday 8a, 1p, 7p SYD
    Sunday 12a, 1a, 8a, 7p SYD
    New Zealand
    Saturday 10a, 3p, 9p NZ
    Sunday 2a, 3a, 10a, 9p NZ
  • Jim Cramer is host of CNBC's "Mad Money" and co-anchor of the 9 a.m. ET hour of CNBC's "Squawk on the Street."

Mad Money Features

  • Grab the latest CNBC gear from the NBCUniversal Store!

  • Get a behind-the-scenes look at how Cramer formulates his investment advice. "Inside the Madness" is a column, which features e-mails and more with Cramer and his researcher Nicole Urken.

  • You’ve always wanted to hit the “Hallelujah!” button. Here’s your chance.

Mad Money Moments

Cramer's New Book