A wave of speculative buying has sent the stock market into a tailspin as we head into the new year, with CNBC’s Jim Cramer urging investors to take profits on the parabolic stock market.
“You’re not making a profit unless you make the cash register ring with some of your profits,” Kramer said on “Mad Money” Tuesday night. These are just “paper profits. It doesn’t count,” he says.
“Let’s say you made a big profit on a stock that skyrocketed this year. Tomorrow you should take something off the table,” Kramer said.
Kramer identified more than 30 U.S.-listed stocks with market caps of $1 billion or more that had risen at least 50% since the beginning of the year as of Friday’s close. Stocks that tick all of these boxes are ones investors should keep an eye on for trimming, he said.
“In most cases, these are companies with no revenue and very little revenue,” Cramer said, explaining that the group’s deals echoed speculation late last summer in areas such as quantum computing, cryptocurrencies and alternative energy.
In late September, Mr. Cramer began sounding the alarm about the market’s over-frothiness, imploring investors to sell hot stocks with little revenue to justify their valuations. After all, many high-flying stocks, such as Nuclear Play’s Oklo, were hit hard during the decline and remain well off their highs.
“Back then, I blamed the people who didn’t benefit. I was loud about it, and I’m doing the same thing tonight,” Kramer said. He added: “I’m not advocating selling everything. What I’m advocating is trying to get a large portion of the stock and turn it into cash. That way you’re playing with what I call home money.”
Cramer’s comments on Tuesday came as markets fell broadly as President Donald Trump ramped up his rhetoric on Greenland with threats of tariffs.
