When Value Investing Doesn't Work

When the Dow drops thousands of points in a matter of months, listening to some guy on TV telling you that this or that stock is cheap is going to get you killed, Cramer says. A lot of stocks look cheap after the market's taken such a beating, but that doesn't make them so. Besides, you know what happens to stocks that look cheap in an ugly market? They tend to get even cheaper.

Watch this video for Cramer's explanation of why valuation is the worst reason to buy a stock during a big downturn.

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