CNBC's Jim Cramer knows that Wall Street's hedge fund managers will undoubtedly have a strategy for approaching the United States' trade debacle with China.
"These hedge funds are putting on what we call paired trades, ... betting against one company with huge Chinese exposure and going long a similar company with little to no Chinese business," the "Mad Money" host said on Friday. "The idea is that whatever the industry, the stock with China exposure is going perform worse than the one without it."
While he admitted that it's hard to pit President Donald Trump — the man behind "The Art of the Deal" — against those who study Sun Tzu's "The Art of War," he wanted viewers to understand how the game is played.
"I want to make it clear that I am not advocating this strategy for you homegamers," Cramer said. "The issue here is that the president is OK with hurting American companies that do business in the People's Republic."
"It implies there will be actual repercussions, earnings per share repercussions, and that is something we are not prepared for from this trade spat, which means hedge fund managers are going to shoot first and ask questions later," the "Mad Money" host continued.