Online Extra: How We Compiled Cramer's Report Card
To see how well Jim Cramer's picks did, we used the same method that we use to calculate the performance of Gene Marcial's Heard on Wall Street column. For each stock, we compare the close price the day the stock was mentioned to the close price one day, one month, and three months later. The exception are the two stocks for which Cramer issued sell recommendations, PNC Financial Services Group (PNC ) and Exxon Mobil (XOM ). For those, we took the return to the date of the sell recommendation, averaging the close of that day and the close of the next day.
For each time period, we take the average of the returns for the applicable stocks (24 stocks for the one-day return, 22 stocks for the one-month return, and 18 stocks for the three-month return). We then compare those results to the returns on the Dow Jones and S&P 500 for the comparable time periods, in exactly the same way that we use to rate Marcial's performance. We also included a column comparing how the stock did from when it was first picked until the Oct. 18, 2005, close price (with the two exceptions mentioned above).
Cramer's Conflict Rules
Still stinging from the ethical brushfires that resulted from his former dual role as hedge-fund manager and markets commentator, Cramer and his family no longer own individual stocks (other than his 15.4% stake in TheStreet.com (TSCM ), his family is entirely in municipal bonds). He manages a charitable trust that includes stocks. He trades stocks for his charitable trust only after alerting readers of his TheStreet.com column "Mad Money" via e-mail alerts. About an hour elapses between when the alerts are sent out and when the transactions are completed. He must wait five days after telling his audience to buy or sell stocks in the trust.
Similarly, CNBC employees, from producers all the way down to support and make-up staff, are prohibited from owning individual stocks other than shares of parent company, General Electric (GE ).
|Name||Date Mentioned||% chg 1 day||% chg 1 month||% chg 3 months||% chg 10/18/05|
|Google (GOOG)||April 25, 2005||-2.1||16.7||32.4||35.7|
|GameStop (GME)||May 9, 2005||-0.3||25.4||27.8||27.5|
|Apple Computer (AAPL)||April 11, 2005||1.8||-15.1||-9.1||24.5|
|St. Jude Medical (STJ)||June 27, 2005||2.5||9.5||6.4||13.2|
|McAfee (MFE)||May 23, 2005||4.1||-0.1||14.9||12.7|
|Motorola (MOT)||June 6, 2005||1.2||3.2||25.1||12.6|
|Conexant Systems (CNXT)||September 19, 2005||17.2||NC||NC||9.2|
|Terex (TEX)||July 29, 2005||5.3||-2.4||NC||8.8|
|Palm (PALM)||May 9, 2005||0.0||8.7||21.9||8.4|
|Medco Health Solutions (MHS)||July 7, 2005||-3.3||-3.4||5.0||7.4|
|Best Buy (BBY UN)||June 13, 2005||14.7||25.8||13.6||7.0|
|Caterpillar (CAT)||July 18, 2005||5.1||4.6||6.2||6.2|
|Time Warner (TWX)||June 20, 2005||2.2||-2.8||7.2||3.5|
|Pike Electric (PEC)||September 26, 2005||9.9||NC||NC||3.3|
|Goldman Sachs Group (GS)||April 7, 2005||-0.5||-7.8||-8.3||3.1|
|Motorola (MOT)||July 22, 2005||2.7||4.6||NC||0.9|
|PNC Financial Services Group (PNC)||May 9, 2005||0.3||0.7||0.6||*||0.6||*|
|Lyondell Chemical (LYO)||September 7, 2005||3.5||0.6||NC||-2.0|
|Intel (INTC)||May 16, 2005||1.5||7.1||2.6||-6.4|
|Exxon Mobil (XOM)||April 1, 2005||0.2||-5.8||-6.4||*||-6.4||*|
|Gold Kist (GKIS)||July 11, 2005||4.5||-10.6||-12.2||-10.0|
|Pfizer (PFE)||April 18, 2005||-0.7||3.0||-1.3||-12.6|
|Constellation Brands (STZ)||May 2, 2005||0.1||3.0||1.7||-14.5|
|Dick's Sporting Goods (DKS)||August 15, 2005||-16.1||-22.5||NC||-25.1|
|* Based on date of sell recommendation|
|Data: Bloomberg Financial Markets, Business Week|