Learn From Cramer’s Mistakes
On what is the holiest Jewish day of the year, Yom Kippur, or the Day of Atonement, the faithful seek forgiveness and repent.
To mark the Day of Atonement, Jim Cramer sought to atone for his bad stock calls of the past year.
“My errors are rooted in overconfidence, in arrogance of judgment and in too much belief in what has worked so well before that it has to work again,” Cramer said. “They are blunders I make because I sometimes feel like I have seen this movie before and I know how it ends, when the great challenge of investing in the stock market means that in reality it's much more like a close sporting event, where you don't know what the outcome will be, and just when you're sure you do that's when you get the big upset.”
The worst errors the “Mad Money” host said he made, though, was either trusting too much or not enough. He trusted some executives too much while he didn’t listen to other corporate leaders enough.
Cramer admitted he wrongly suggested investors stay in Chipotle Mexican Grill’s stock long after it was probably time to sell.
In May, Cramer warned against First Solar’s stock, even though in hindsight, it might have been a great buying opportunity. At the time, he thought it was a value trap, meaning the stock appears cheap, but will probably go lower because the underlying company's business prospects are dim. He called it a "sell" all the way down to $13 a share, but as it turned out, First Solar got its groove back and the stock doubled. (Hear more from Cramer on First Solar here.)
"The business is not as horrible as I thought," Cramer said of First Solar. "Now that's no reason to buy it, but it's no reason to hate it anymore either."