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Cramer: You may need to rethink your approach

To any investor that cannot handle the downturn of a high-quality stock, Jim Cramer used the rally on Monday to make a point. Yes, any stock has the ability to go down when the market gets hammered — including FANG.

When Cramer looked over the charts on the weekend, he was stunned to find that very few stocks have been able to hold up in the recent sell-off.

Cramer created the acronym FANG — which stands for Facebook, Amazon, Netflix and Google — to represent his top selection of growth stocks in the current market environment.

"But I say if you are going to own FANG, you need to think long-term, and if you cannot take a couple of points of short-term downside, then you need to rethink your whole approach to the market," the "Mad Money" host said.

It made complete sense to Cramer that these stocks could head higher in the long term. With the economy slowing, investors should be looking for stocks that will go higher, regardless of gross product growth and regardless of whether the Fed will raise rates. But if the market is bad, they can still get hit. To clarify, Cramer reviewed what each stock brings to the table.

FANG (Facebook, Amazon, Netflix and Google) apps on a smartphone.
Adam Jeffery | CNBC
FANG (Facebook, Amazon, Netflix and Google) apps on a smartphone.
"Let's be honest here, horrific acts of terrorism really don't embolden people to go shopping. It could be a very Amazon Christmas" -Jim Cramer

First is Facebook, which has cranked out an amazing 40 percent-plus growth. It is pretty clear to Cramer that this company is just scratching the surface of its earnings power given that content is created by the users, and that is exactly what advertisers want. Ultimately, Facebook is just getting started overseas, so its growth is still at its infancy. Cramer could easily see Facebook earning $4 in 2017.

Amazon has also managed to be a winner at a time when retail is struggling. Best Buy, Nordstrom and Macy's are all suffering due to the lack of foot traffic in stores, and Cramer can only conclude that Amazon is taking a big share from them.

"Let's be honest here, horrific acts of terrorism really don't embolden people to go shopping. It could be a very Amazon Christmas," Cramer said. (Tweet This)

Netflix was down last week on news that Time Warner has interest in taking a stake in Hulu. But Cramer had a hard time believing Hulu is a threat to Netflix. He does not think Hulu is a real Netflix competitor, and investors agreed when the stock came bouncing back.

Google, now called Alphabet, is another application with so much power that hasn't yet been exploited. Cramer is beginning to wonder when the heck the company will think bigger with YouTube, and it could happen any day.

With all of these reasons to like FANG, why did Cramer say they can go down?

Because he has heard endless chatter from shareholders who complain that they are down, and it is driving him crazy.

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"When you see the kind of panic that gets created whenever one of these stocks goes down ever so slightly, you know that there are way too many people in them who don't understand the very concept of stocks, let alone what these companies really do to make money," Cramer said.

Meaning, it is possible to have a perfectly good company with a stock that goes lower.

FANG represents four companies with great prospects, but if the stock market is selling off, they will go down with the gravitational pull, too.

Therefore, Cramer reminded investors that the market is a tide. He is a huge champion of FANG, but these stocks cannot stay up forever if the market is going down. And for those investors who are going to fret every time time the market takes a hit, Cramer says to ring the register on these stocks and move on. Anyone who cannot take the pain should just move on.

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