I haven't beat up on ole Jim Cramer for awhile, so let's take a quick look-see at his year-to-date progress in his public portfolio. Remember from past pieces, I like to look at what he does, not what he says, to evaluate his worth as a stock picker. His public (for subscription) Action Alerts PLUS portfolio is the closest he comes to a real time track record to gauge his stock picking abilities, or lack thereof.
Year to date, the S&P 500 index is up about 12% and the Russell 2000 index is up a little over 16%. For the same period, Jim Cramer's Action Alerts Plus portfolio is up 3.89%.
That means that the charities that Cramer donates his profits from the portfolio to would have had about an additional $250,000 if Jim had put the portfolio in an S&P index fund at the beginning of the year, or about an additional $360,000 if he had put the money into a Russell 2000 index fund.
So let's give Jimbo a grade for his performance. He didn't lose money in bull market, so we really can't fail him. But he couldn't beat the most mundane of all indexes, the S&P 500, so we can't give him much of a grade above "C". That's leaves a "C" or a "D". Normally, class participation counts, and with Cramer all over the TV and radio, he certainly is in our face enough with his stock opinions to make a case for extra credit for effort.
But, there's the rub. The first rule of medicine and the first rule of investing are the same, First, do no harm. One who bellows his opinions in such a ubiquitous persona owes a duty to the public to first, do no harm. It's one thing to short change a charitable trust by poor performance, quite another to lure an unsuspecting public into a false sense of competency.
Cramer get's a "D", passing, but barely so, Mr. Harvard Hedge Fund Honcho.