Using Veritas to Construct the "Per…

29-04-2017 Hits:82134 BoomBustBlog Reggie Middleton

Using Veritas to Construct the "Perfect" Digital Investment Portfolio" & How to Value "Hard to Value" tokens, Pt 1

The golden grail of investing is to find that investable asset that provides the greatest reward with the least risk. Alas, despite how commonsensical that precept seems to be, many...

Read more

The Veritas 2017 Token Offering Summary …

15-04-2017 Hits:77760 BoomBustBlog Reggie Middleton

The Veritas 2017 Token Offering Summary Available For Download and Sharing

The Veritas Offering Summary is now available for download, which packs all the information about Veritas in a single page. A step by step guide to purchasing Veritas can be downloaded here.

Read more

What Happens When the Fund Fee Fight Hit…

10-04-2017 Hits:77330 BoomBustBlog Reggie Middleton

What Happens When the Fund Fee Fight Hits the Blockchain

A hedge fund recently made news by securitizing its LP units as Ethereum-based tokens and selling them as tradeable (thereby liquid) assets. This brings technology to the VC industry that...

Read more

Veritaseum: The ICO That's Ushering in t…

07-04-2017 Hits:82077 BoomBustBlog Reggie Middleton

Veritaseum: The ICO That's Ushering in the Era of P2P Capital Markets

Veritaseum is in the process of building peer-to-peer capital markets that enable financial and value market participants to deal directly with each other on a counterparty risk-free basis in lieu...

Read more

This Is Ground Zero for the 2017 Veritas…

03-04-2017 Hits:78667 BoomBustBlog Reggie Middleton

This Is Ground Zero for the 2017 Veritas Offering. Are You Ready to Get Your Key to the P2P Capital Markets?

This is the link to the Veritas Crowdsale landing page. Here is where you will be able to buy the Veritas ICO when it is launched in mid-April. Below, please...

Read more

What is the Value Proposition For Verita…

01-04-2017 Hits:80958 BoomBustBlog Reggie Middleton

What is the Value Proposition For Veritas, Veritaseum's Software Token?

 A YouTube commenter asked a very good question that we will like to take some time to answer. The question was, verbatim: I've watched your video and gone through the slides. The exchange...

Read more

This Real Estate Bubble, Like Some Relat…

28-03-2017 Hits:47839 BoomBustBlog Reggie Middleton

This Real Estate Bubble, Like Some Relationships, Is Complicated...

CNBC reports US home prices rise 5.9 percent to 31-month high in January according to S&P CoreLogic Case-Shiller. This puts the 20 city index close to an all time high, including...

Read more

Bloomberg Chimes In With My Warnings As …

28-03-2017 Hits:79670 BoomBustBlog Reggie Middleton

Bloomberg Chimes In With My Warnings As Landlords Offer First Time Ever Concessions to Retail Renters

Over the last quarter I've been warning about the significant weakness in retailers and the retail real estate that most occupy (links supplied below). Now, Bloomberg reports: Manhattan Landlords Are Offering...

Read more

Our Apple Analysis This Week - This Comp…

27-03-2017 Hits:79189 BoomBustBlog Reggie Middleton

Our Apple Analysis This Week - This Company Is Not What Most Think It IS

We will releasing our Apple forensic analysis and valuation this week for subscribers (click here to subscribe - lowest tier is the same as a Netflix subscription). As can be...

Read more

The Country's First Newly Elected Lame D…

27-03-2017 Hits:79741 BoomBustBlog Reggie Middleton

The Country's First Newly Elected Lame Duck President Will Cause Massive Reversal Of Speculative Gains

Note: Subscribers should reference  the paywall material here for stocks that should give a good risk/reward scenario for bearish trades. The Trump administration's legislative outlook is effectively a political desert, with...

Read more

Sears Finally Throws In The Towel Exactl…

22-03-2017 Hits:84720 BoomBustBlog Reggie Middleton

Sears Finally Throws In The Towel Exactly When I Predicted "has ‘substantial doubt’ about its future"

My prediction of Sears collapsing once interest rates started ticking upwards was absolutely on point.

Read more

The Transformation of Television in Amer…

21-03-2017 Hits:81666 BoomBustBlog Reggie Middleton

The Transformation of Television in America and Worldwide

TV has changed more in the past 10 years than it has since it's inception nearly 100 years ago This change is profound, and the primary benefactors look and act...

Read more

James Cramer: marked to market!

This is most likely the final installment in my "Name Brands aren't all they're cracked up to be" series. This string of articles has seen me compare my (a lowly blogger's) research model investment results with the biggest and most influential names and indices in the US stock market. For those who feel that the research model is too hypothetical (nonsense actually, since it is the most well documented of its kind that I have seen), I have included a snapshot of my own proprietary trading account. I will get to Cramer in a minute, but before I do, let's peruse the roadmap of how we got here. Here is the synopsis to date:

  1. "A synopsis of post that I have made on the "Name Brand" syndrome that seems to have hoodwinked so many individual and INSTITUTIONAL investors enamored by the marketing machine that is the Wall Street banks, brokers and Greenwich/mid-town hedge funds.
  2. My blog's research model results, currently up 104% since inception and 85% year to date (simple buy and hold) as compared to all major (and minor) hedge fund and broad market indices.
  3. A glimpse into my proprietary trading, up considerably over a hundred percent year to date and since inception via about 62 stocks, stock picking only with an average of about 50% cash with no leverage (I cannot rule out positions in currencies and sovereign debt). This particular post, since it has the most information, actually details alpha generated, relative and absolute returns, and both raw return and risk adjusted return using a variety of measures as compared against the broad market and 16 or so different hedge fund indices
  4. Blog vs. Broker, whom do you trust! - a comparison of the blog's research model and the most prominent Wall Street bank's buy and sell recommendations over a comparable period - Goldman Sachs, Citibank, JP Morgan, and Morgan Stanley.
  5. A backgrounder on my investing style, and a comprehensive comparison of both the blog and my results as compared to all major (and minor) hedge fund indices. 

 

Please note that all of the comparisons in the bullet list are extremely comprehensive, with hyperlinks to all of the posts and research reports that I have issued behind my research, as well as the comparable calls by the banks, Cramer's services, hedge fund index performance measures, etc. I have included extensive documentation that is free to download, peruse and compare.

On to Cramer

Yes, the man is a clown, but that is his business model and I actually like him. I find him entertaining (in very small doses, of course). I just want to caution all to take Cramer for what he is, an entertainer, and not for what he is not, which is an investment guru and competent stock picker. With that being said, let me defend the man some more.

A couple of weeks ago, he stated on national TV that those who have money that they will need in the next 5 years in the stock market should remove it. He caught a lot of flak for that statement. He shouldn't have. He was absolutely right. I tell my friends and family that they should have done that in June of last year if they were not comfortable and capable of going short. Those that did escaped a lot of pain, those that did not, well...

The problem with Cramer is that many individual investors seem to perceive him as a man who really knows what he is talking about when it comes to stock picking. His antic behavior aside, the numbers do not bear that out. His popularity among the "hot tip" crowd has garnered him significant influence in both the business and the financial community. Hey, more power to him. I wish everyone success, but to be blunt and frank, I perceive him as much more an entertainer than an investor. Hey, don't take this personally Cramer. In case you're wondering who I am, I'm that handsome brother that called your name out with that tall, sexy red head on Court Street by the movie theater a few months ago.  

One of my regular readers who initially compiled a performance spreadsheet of my blog has just sent me a comparison to Cramer's Action Alert Plus, a paid service that Cramer offers through his site to track his trades and recommendations. I have to admit, I was actually flabbergasted when I saw how much he charges for his stuff. Then again, I probably don't include as much entertainment, in my material. I am making the email and the file available to the public for download. I have not checked every trade or entry, but all seems legit. Long story short, there is a 125% (yep, you read that right, ONE HUNDRED AND TWENTY FIVE PERCENT!) spread between his performance and my blog's research model. To be as conservative as possible, I am not going to compare his results to my actual proprietary trading account, for if I were that already very large spread would be blown out. Cramer is down about 40% this year (roughly on par with the broad market), but even more telling is that his average holding period return is negative fifteen percent (-15%). We're not even including the cost of the service here. A quick glance at bankrate.com reveals one would have been much better off (roughly 18.6% better) had you just put your money in a bank CD (of course these days it does matter which bank, see the Asset Securitization Crisis series for much more on this). This would be an ideal time to push my subscription service, but I'm going to hold back and bite my tongue,,, till it bleeds... Who wants dibs on whether CNBC will feature this blog post or put me on the air???

 

Judging by the amount of trading that he was doing, expenses and risk most likely ramped up as well. I haven't run the risk adjusted reward analysis, but my more astute readers can use their imagination. Here is the email from the BoomBustBlogger along with spreadsheet attachment for download...

 

Ok Reggie, I just sent you the Boombustblog vs. Cramer Actionalertsplus.com excel comparison

 

took a lot longer than I thought and required a few judgment calls along the way since  he has a bunch of restrictions in his trading that force him to scale in and out of his positions slowly but I didn't want the results to be impacted by that, he flip flops like crazy on stuff too and trades in and out of stocks with no notice and then all of the sudden some stock he hated is number one on his buy list because its down like 1$, so it's really hard to follow the guy, he has no hard trading rules either, he just buys 500 shares "because it's too cheap" and then sells them later with no reason based on very arbitrary price targets, the most qualitative based trading I've seen with no mention of technical's either, and he often sells his winning stocks to double down on his losing trades, which hurt him badly as things started to deteriorate as you can see by his average holding period return of ~-15% but he is down ~-40% this year by being heavily weighted in losing trades. I think this sheet basically shows what a reader could have done if they had followed his trading recommendations without all his restrictions and didn't try to copy his disastrous trading strategy trade for trade.  All my sources are hyperlinked so if a reader disagrees or thinks I made a mistake they can easily change it to get their own results, I'm assuming you want me to post that to my mini-site once you look it over.

 

  I didn't model each of his hundreds of trades as he scaled in and out of stocks since the comparison of your blog I did before didn't have active trading in it, so this is more comparable.  Also, he is against using leverage, so his returns (losses) are totally unlevered and without transaction costs but include his dividends.  If a reader had used his trading and followed his stock weightings and trades letter for letter they would be down 39.48% ytd according to his site, which I guess is a little better than some indexes but still painful.  According to his site, his average yearly return since 01/01/2002 is -15.49% also, which is surprisingly bad. 

Prices will auto update if readers have the MSN money excel add in. Reggie note: I switched this to web queries so any Excel client, '97 or higher can have the auto-update feature, just click the data refresh command.

 

Please let me know if you want anything added or if you would like the data sliced and diced some other way.


PS: I don't know how much you want to beat up poor ole Cramer too, but I could go through and make a chart of GS and MS and mark every time he went long on the stocks you recommended going short and put it on a chart, would be a pretty painful chart for Cramer followers, he kept going long MS over and over from 46$ and he's been in GS since >200$  Reggie note: both stocks are down over 50%, and I issued several 20 page reports warning about this, dating back to the first quarter of the year. See Goldman Sachs Snapshot: Risk vs. Reward vs. Reputations on the Street and Reggie Middleton on Risk, Reward and Reputations on the Street: the Goldman Sachs Forensic Analysis for Goldman and The Riskiest Bank on the Street, Reggie Middleton on the Street's Riskiest Bank - Update for Morgan Stanley. There are literally hundreds of other examples to be found in the links above and the spreadsheet, for those that are truly interested.

PPS: I've attached a copy of his "MS" research too when he went long MS in 05/12/08, for comparison vs. your site.  His site doesn't allow you to cut and paste so I just pasted screen shots, let me know if too difficult to read or you have any trouble opening/using/understanding the files.

Reggie note: I excluded this for the obvious copyright reasons. On can either subscribe to the free trial or use your imagination, I feel you'll come up with a similar result. I have also decided to paste the relevant data here in hyperlinked HTML in lieu of including a 40 megabyte spreadsheet. The first table is my BoomBustBlog research model results to date. The second table below that is a compilation of Cramer's ActionAlertsPlus.com (his premier advisory service) results. Since both tables are hyperlinked into the actual trades/research/recommendations that generated them, readers are free to paste them into their own spreadsheets to slice, dice and manipulate the data as they see fit. This way, you are not beholden to any of the assumptions presented here.

 

Reggie Middleton's BoomBustBlog.com Research Model

Date of Analysis

10/28/2008

           

Average Return

Average % Change

           

95.40%

(49.56%)

         

Drill Down and Forensic Analysis Results

               

Blog post date

Companies negatively Blogged

Price as of Blog Date or following trading day

10/28/2008

% change

Assumed Holding Period in Months

Holding Period Return

 

1-Sep-07

len

$28.57

$6.44

(77.46%)

          13.90

148.09%

148.09%

 

hov

$12.60

$3.38

(73.17%)

          13.90

140.44%

140.44%

 

phm

$16.95

$8.42

(50.32%)

          13.90

94.74%

94.74%

 

ctx

$29.12

$8.61

(70.43%)

          13.90

134.96%

134.96%

 

dhom

$2.08

$0.55

(73.56%)

          13.90

141.21%

141.21%

1-Sep-07

bzh

$11.29

$2.26

(79.98%)

          13.90

154.06%

154.06%

 

rdn

$18.11

$2.10

(88.40%)

          13.90

170.90%

170.90%

 

mtg

$30.34

$2.15

(92.91%)

          13.90

179.92%

179.92%

1-Sep-07

dhi

$15.41

$4.70

(69.50%)

          13.90

133.09%

133.09%

 

tol

$21.84

$17.43

(20.19%)

          13.90

34.48%

34.48%

 

bsc

$114.13

$5.71

(95.00%)

          13.90

180.49%

180.49%

 

cfc

$19.81

$4.25

(78.55%)

          13.90

151.18%

151.18%

3-Sep-07

mbi

$61.92

$6.53

(89.45%)

          13.83

173.00%

173.00%

 

abk

$64.63

$2.18

(96.63%)

          13.83

187.35%

187.35%

8-Sep-07

wm

$34.74

$0.16

(99.54%)

          13.87

193.17%

193.17%

16-Oct-07

ryl

$23.96

$15.02

(37.31%)

          12.60

68.72%

68.72%

19-Dec-07

ms

$50.08

$13.73

(72.58%)

          12.60

139.26%

139.26%

8-Jan-08

ggp

$33.90

$1.97

(94.19%)

          12.60

182.47%

182.47%

14-Jan-08

bac

$39.22

$20.53

(47.65%)

            9.47

92.73%

92.73%

25-Jan-08

kbh

$23.65

$12.24

(48.25%)

            9.10

93.92%

93.92%

19-Feb-08

leh

$53.57

$0.13

(99.76%)

            8.30

196.94%

196.94%

8-Feb-08

ago

$21.57

$7.90

(63.38%)

            8.67

124.18%

124.18%

21-Feb-08

key

$23.03

$9.92

(56.93%)

            8.23

111.28%

111.28%

25-Feb-08

ffhs

$8.40

$5.81

(30.83%)

            8.10

59.09%

 
 

ms

$45.28

$13.73

(69.68%)

            8.10

136.78%

136.78%

 

c

$24.74

$11.73

(52.59%)

            8.10

102.60%

102.60%

 

wfc

$31.69

$30.83

(2.71%)

            8.10

2.85%

2.85%

 

gs

$177.36

$92.88

(47.63%)

            8.10

92.69%

92.69%

 

mer

$54.42

$15.21

(72.05%)

            8.10

141.53%

 
 

wb

$34.72

$5.74

(83.47%)

            8.10

164.36%

164.36%

17-Mar-08

bsc

$4.81

$9.33

93.97%

            7.37

180.18%

180.18%

27-Mar-08

kfn

$12.71

$2.85

(77.58%)

            7.03

152.58%

152.58%

2-Apr-08

jef

$17.15

$13.01

(24.14%)

            6.87

45.70%

 

15-May-08

pnc

$69.39

$58.63

(15.51%)

            5.43

28.44%

28.44%

22-May-08

bpop

$11.52

$6.17

(46.44%)

            5.20

90.31%

 
 

sti

$54.85

$35.34

(35.57%)

            5.20

68.56%

68.56%

 

snv

$12.32

$8.34

(32.31%)

            5.20

62.04%

 
 

mi

$23.59

$15.26

(35.31%)

            5.20

68.05%

 
 

asbc

$28.29

$18.40

(34.96%)

            5.20

67.34%

 
 

fctr

$30.20

$30.02

(0.60%)

            5.20

(1.38%)

 
 

mtb

$89.89

$75.32

(16.21%)

            5.20

29.84%

29.84%

 

hban

$9.23

$9.17

(0.65%)

            5.20

(1.27%)

(1.27%)

 

bbt

$33.44

$32.20

(3.71%)

            5.20

4.84%

 
 

jpm

$43.05

$34.00

(21.02%)

            5.20

39.47%

 
 

usb

$33.24

$28.82

(13.30%)

            5.20

24.02%

 
 

cof

$48.92

$34.40

(29.68%)

            5.20

56.79%

56.79%

 

wm

$9.45

$0.16

(98.31%)

            5.20

194.04%

194.04%

 

cfc

$4.69

$4.25

(9.38%)

            5.20

16.19%

16.19%

 

rf

$19.14

$9.95

(48.01%)

            5.20

93.45%

 
 

zion

$43.47

$34.56

(20.50%)

            5.20

38.42%

 
 

tcbk

$15.92

$15.50

(2.64%)

            5.20

2.70%

 
 

fitb

$19.88

$8.47

(57.39%)

            5.20

112.21%

 
 

sov

$8.78

$2.18

(75.17%)

            5.20

147.77%

 

16-Jun-08

ge

$28.97

$17.73

(38.80%)

            4.40

75.02%

75.02%

30-Jul-08

axp

$37.54

$23.08

(38.52%)

            2.93

75.71%

75.71%

30-Jul-08

hbc

$82.32

$52.00

(36.83%)

            2.93

72.34%

72.34%

21-Aug-08

nav

$55.30

$21.99

(60.24%)

            2.23

119.56%

119.56%

26-Aug-08

wire

$18.70

$15.80

(15.51%)

            2.07

30.11%

30.11%

11-Sep-08

sfd

$21.00

$10.79

(48.62%)

            1.57

96.33%

96.33%

               
         

Average

Average

Average

       

Since 7/07

            8.41

94.15%

104.36%

       

Year to Date

            6.35

77.32%

84.64%

               
 

7-Sep

10/28/2008 3:00

YTD Performance

Perf. Since Blog incpetion

   

S&P 500

                  1,471.49

                  848.92

(42.31%)

(41.34%)

     
   

(42.31%)

         

Nasdaq

                  2,596.36

               1,505.90

         
   

(42.00%)

         

 

James Cramer's ActionAlertPlus.com

 

 

 

ActionAlertsPlus.com post date

Companies Mentioned

Price as of Blog Date or following trading day

10/28/2008

 

 

buy

4-Sep-07

glw

$24.15

   

 

buy

6-Sep-07

fcx

$91.70

   

 

buy

6-Sep-07

mcd

$49.76

   

 

buy

12-Sep-07

cvs

$37.31

   

 

buy

 

igt

$40.92

   

 

buy

14-Sep-07

c

$46.64

   

 

buy

 

cop

$85.27

   

 

buy

 

emc

$19.28

   

 

buy

 

ima

$48.63

   

 

buy

 

nyx

$70.69

   

 

buy

 

xto

$48.46

   

 

buy

 

mo

$20.67

   

 

buy

 

aig

$64.96

   

 

buy

 

cat

$73.16

   

 

buy

 

gs

$190.59

   

 

buy

 

hpq

$48.38

   

 

buy

 

holx

$27.45

   

 

buy

 

nke

$57.23

   

 

buy

 

shld

$134.93

   

 

buy

 

rig

$113.01

   

 

buy

 

unp

$55.92

   

 

buy

 

unh

$49.91

   

 

buy

11-Oct-07

rtn

$65.04

   

 

sell

27-Oct-06

hpq

$38.46

   

 

sell

 

aig

$67.39

   

 

buy

5-Nov-07

sgp

$29.46

   

 

sell

30-Nov-07

unp

$63.07

   

 

buy

12-Dec-07

stj

$41.40

   

 

buy

27-Dec-07

nly

$17.79

   

 

buy

22-Jan-08

disca

$20.79

   

 

sell

15-Jan-08

c

$26.94

   

 

sell

17-Jan-08

igt

$39.41

   

 

sell

18-Jan-08

cat

$62.81

   

 

   

xto

$51.77

   

 

buy

23-Jan-08

hpq

$43.19

   

 

sell

25-Jan-08

rig

$127.11

   

 

   

cvs

$35.56

   

 

buy

28-Jan-08

mcd

$51.07

   

 

buy

30-Jan-08

fwlt

$68.14

   

 

sell

5-Feb-08

nyx

$71.03

   

 

buy

20-Feb-08

vz

$35.08

   

 

buy

21-Feb-08

auy

$17.06

   

 

buy

25-Feb-08

bdk

$69.52

   

 

buy

28-Feb-08

bp

$66.16

   

 

sell

7-Mar-08

hpq

$47.31

   

 

sell

7-Mar-08

glw

$22.83

   

 

buy

27-Mar-08

ep

$16.14

   

 

buy

31-Mar-08

pm

$50.58

   

 

buy

21-Apr-08

oi

$59.90

   

 

sell

25-Apr-08

unh

$33.99

   

 

sell

1-May-08

holx

$23.75

   

 

sell

1-May-08

nly

$17.33

   

 

buy

6-May-08

nov

$68.82

   

 

sell

9-May-08

stj

$40.93

   

 

sell

9-May-08

ima

$34.56

   

 

buy

12-May-08

ms

$47.65

   

 

buy

12-May-08

abt

$52.78

   

 

buy

15-May-08

pwr

$29.96

   

 

sell

16-May-08

vz

$38.77

   

 

   

shld

$94.91

   

 

sell

22-May-08

bp

$76.12

   

 

buy

28-May-08

wmt

$57.09

   

 

buy

29-May-08

de

$81.00

   

 

sell

5-Jun-08

cop

$93.82

   

 

buy

5-Jun-08

swn

$46.04

   

 

sell

18-Jun-08

pm

$49.90

   

 

buy

18-Jun-08

dvn

$122.32

   

 

buy

23-Jun-08

cog

$67.56

   

 

buy

12-Jun-08

trn

$38.20

   

 

sell

8-Jul-08

auy

$14.95

   

 

buy

10-Jul-08

pg

$64.22

   

 

sell

18-Jul-08

ep

$18.33

   

 

buy

18-Jul-08

gild

$49.53

   

 

buy

17-Jul-08

qcom

$45.56

   

 

buy

23-Jul-08

pep

$67.72

   

 

sell

24-Jul-08

rtn

$56.96

   

 

sell

25-Jul-08

emc

$14.01

   

 

sell

23-Jun-08

oi

$49.10

   

 

buy

23-Jul-08

wag

$34.68

   

 

buy

5-Aug-08

wlp

$55.02

   

 

buy

6-Aug-08

jpm

$41.39

   

 

buy

8-Aug-08

csco

$24.25

   

 

buy again

6-Aug-08

hpq

$45.15

   

 

buy

8-Aug-08

cost

$66.99

   

 

sell

10-Aug-08

wlp

$77.02

   

 

sell

12-Aug-08

bdk

$64.06

   

 

buy

12-Aug-08

nke

$62.10

   

 

sell

19-Aug-08

swn

$36.63

   

 

buy

20-Aug-08

gis

$66.83

   

 

sell

22-Aug-08

trn

$35.26

   

 

sell

28-Aug-08

mcd

$62.89

   

 

buy

29-Aug-08

celg

$69.30

   

 

sell

28-Aug-08

sgp

$20.05

   

 

buy

12-Sep-08

ge

$26.75

   

 

buy

12-Sep-08

un

$29.55

   

 

buy

22-Sep-08

gld

$89.18

   

 

sell

26-Sep-08

disca

$16.20

   

 

   

disk

$0.91

   

 

buy

1-Oct-08

cvx

$82.20

   

 

sell

2-Oct-08

cog

$29.94

   

 

   

dvn

$83.10

   

 

   

nke

$63.75

   

 

buy

3-Oct-08

kft

$33.08

   

 

buy

3-Oct-08

jnj

$66.16

   

 

buy

6-Oct-08

bmy

$19.32

   

 

buy

20-Oct-08

vfc

$54.69

   

 

           

 

           

 

           

 

           

 

   

7-Sep

10/28/2008 3:07

YTD Performance

Perf. Since Blog incpetion

 

 

sp 500

                  1,471.49

                  848.92

(42.31%)

(41.34%)

 

     

(42.31%)

   

 

 

naz

                  2,596.36

               1,505.90

   

 

     

(42.00%)

   

average holding period in months

                            5.20

 

 average holding period return

-14.66%

 

01/01/2008-10/27/2008

-39.48%

 

 average yearly return since 01/01/2002

-15.29%