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Is Knight Capital Still a Buy?

There’s a reason Cramer believes in “buy and homework” rather than “buy and hold.” Circumstances often change, as do the reasons for owning a stock. And when a thesis no longer works, investors have to reassess.

Such was the case with Knight Capital Group , which Cramer recommended back on Sept. 16. He liked the financial-services company as a play on increased trading activity and volatility, but NITE has dropped 35% from $21.84 since then.

In October, Knight Capital missed the Street’s earnings expectations, partly because the company made less money per trade. Then November saw a near 10% drop in trading volume from the previous month as competition increased. And to top it off, Washington seems intent on entering some of Knight’s business, namely so-called dark pools. These events sent the share price tumbling.

So, should investors bail? Or maybe buy more at these lower levels? Does Cramer’s thesis still hold? He invited Knight Capital Group Chairman and CEO Thomas Joyce onto Mad Money to find out. Watch the full interview here.

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