Jim Cramer and Bitcoin: a signal that is highly misleading?

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This ambiguity, however, encounters familiar territory: Cramer's statements have for years fueled the "Reverse Cramer", a meme consisting of taking the opposite view of his recommendations. The concept even gave birth to two ETFs.

The Mad Money presenter has not always expressed reservations towards cryptocurrencies. In 2021, he explained that he used part of his Bitcoin earnings to repay a mortgage. In June, he nevertheless announced that he had sold almost his entire position, citing in particular the Chinese crackdown on mining.

After the bankruptcies that marked 2022, his speech has hardened. On December 5, 2022, when Bitcoin was trading around $17,150, Jim Cramer encouraged investors to exit their crypto positions, believing that it was never too late to sell a bad position.

In November 2023, he admitted having been “premature” in his decision to sell. He also recalled having made money with his investment. These successive interventions illustrate a changing opinion, rather than a constant opposition to Bitcoin.

His new message should therefore be read with caution. Without specifying what it means, attributing to it a general rejection of cryptocurrencies exceeds the four words published.

Tuttle Capital Management turned this reputation into financial products on March 2, 2023. The Long Cramer Tracker ETF (LJIM) followed its recommendations, while the Inverse Cramer Tracker ETF (SJIM) sought to take the opposite view. The funds were neither affiliated with nor managed with Mr. Cramer.

The experience was short. LJIM closed in 2023. SJIM ceased trading on February 13, 2024, with liquidation scheduled for February 23. Its manager cited insufficient interest from investors and his other commercial priorities.

The anecdotes often associated with the meme also require context. Concerning Bear Stearns in 2008, Cramer explained that he had reassured clients about the funds entrusted to the establishment, without recommending the purchase of his stock. Summarizing this episode to a failed stock tip erases this distinction.

The contrast between his call to sell in December 2022 and Bitcoin crossing $100,000 two years later fuels the jokes. It does not turn every pessimistic statement into a buying signal. The Cramer Reverse remains a commentary on the credibility of media pundits, not a method whose effectiveness is established. Far from it.

Machine-translated from French