Cramer's 7 Deadly Sins Of Stock Investing

Cramer's 7 Deadly Sins Of Stock Investing

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Pundits love telling investors how to invest their money, but seldom does one go over a list of how not to invest in stocks. CNBC's Jim Cramer went over during his "Mad Money" show what he calls his "seven deadly sins of investing."” data-reactid=”19″>Pundits love telling investors how to invest their money, but seldom does one go over a list of how not to invest in stocks. CNBC’s Jim Cramer went over during his “Mad Money” show what he calls his “seven deadly sins of investing.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="1. No Cheerleading: There is no room for "cheerleading" in stocks, Cramer said. Instead of cheering a winning stock in hopes it goes even higher, take some profits&nbsp;off the table, the CNBC host said.&nbsp;” data-reactid=”20″>1. No Cheerleading: There is no room for “cheerleading” in stocks, Cramer said. Instead of cheering a winning stock in hopes it goes even higher, take some profits off the table, the CNBC host said. 

“Buy low, sell high — not buy low, cheerlead high.” 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="2. Don’t Fall Into Momentum Traps: Investors need to avoid buying stocks for the simple reason that they’re going up, Cramer said.&nbsp;In fact, investors should be able to understand how a company makes money and list three reasons for buying the stock.” data-reactid=”22″>2. Don’t Fall Into Momentum Traps: Investors need to avoid buying stocks for the simple reason that they’re going up, Cramer said. In fact, investors should be able to understand how a company makes money and list three reasons for buying the stock.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="3. Don’t Look For The Next Big Thing: There is one and only one Tesla Inc (NASDAQ: TSLA) in the market, Cramer said.&nbsp;” data-reactid=”27″>3. Don’t Look For The Next Big Thing: There is one and only one Tesla Inc (NASDAQ: TSLA) in the market, Cramer said. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content=""Stop trying to find the next Tesla when you can just buy Tesla," he said.” data-reactid=”28″>”Stop trying to find the next Tesla when you can just buy Tesla,” he said.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="4. Avoid Low-Dollar Stocks: Investors may assume they’ve found a winner when buying a low-dollar stock. But there is often a reason why a stock is cheap: "management stinks," Cramer said.” data-reactid=”29″>4. Avoid Low-Dollar Stocks: Investors may assume they’ve found a winner when buying a low-dollar stock. But there is often a reason why a stock is cheap: “management stinks,” Cramer said.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="5. Avoid Penny Stocks: Penny stocks are plagued with pump-and-dump schemes. Those that aren’t are likely drowning in debt.” data-reactid=”30″>5. Avoid Penny Stocks: Penny stocks are plagued with pump-and-dump schemes. Those that aren’t are likely drowning in debt.

“You shouldn’t even think about owning a single-digit stock unless you know how to read a balance sheet,” Cramer said.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="6. Don’t Be Greedy: Investors sitting on a "monster gain" shouldn’t make the mistake of sitting on their stock, Cramer said.” data-reactid=”32″>6. Don’t Be Greedy: Investors sitting on a “monster gain” shouldn’t make the mistake of sitting on their stock, Cramer said.

Instead, investors may want to cash out the initial investment and “let the rest run so you’re playing with the house’s money.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="7. Stop Heckling: Heckling pundits, especially Cramer himself, is "not a strategy," the "Mad Money" host said.” data-reactid=”34″>7. Stop Heckling: Heckling pundits, especially Cramer himself, is “not a strategy,” the “Mad Money” host said.

“I’m here as your investing coach. My job is to find good companies and recommend their stocks when the price is right,” he said. “Not when some random person badgers me on social media.”

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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Screenshot courtesy of CNBC.&nbsp;” data-reactid=”39″>Screenshot courtesy of CNBC. 

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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.” data-reactid=”45″>© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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