Love the product, Cramer tells Mad Money’s viewers, don’t love the stock. No matter how great you think a certain technology may be, there’s no guarantee it will work the kind of magic that the iPod did for Apple.
Another point to keep in mind: You might be late to the game. Just because you “discovered” something “new” doesn’t mean the rest of the world doesn’t already know about it.
That’s exactly what happened to Cramer back in 2006 when his charitable trust bought Citrix Systems . He loved the company’s “Go To My PC” product, and used it during his radio show. The software allowed him to see on his monitor which caller was on the line next so he wouldn’t be distracted by producers whispering in his earpiece. Cramer liked it so much, in fact, he bought the stock.
Too bad “Go To My PC” had already been on the market for three years. Tech product cycles are short anyway, so you can all but guarantee a product has peaked after three years. Cramer ended up selling Citrix 10 points lower than his buy-in price.
Watch the video to find out how you can avoid this same mistake.
When this story published, Cramer's charitable trust owned Apple.
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