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Anyone can now bet against Jim Cramer with new Inverse ETF

A new way of investing may soon be available to investors who don't think Jim Cramer's tips are profitable and bet against them.

Jim Cramer is a well-known person in the investment world. He is an American television personality, investor and author. Jim Cramer is the host of ‘Mad Money’ show, where he tells his tips on stocks. Are those tips any good? 

Jim Cramer Inverse ETF

An Exchange Traded Fund (ETF) that tracks the stock picks of one of the most well-known financial media figures will soon have his stock recommendations as its focus. Matthew Tuttle has a new target in mind after previously taking on Cathie Wood, who made astonishing returns during the economic prosperity. But then markets turned around and Tuttle bet against Wood’s ETF and won.

Also read: These 5 countries avoided high inflation (at least for now)

Now Tuttle found its next ‘victim.’ On Wednesday, Tuttle Capital Management filed two new exchange-traded funds (ETFs) that would follow Jim Cramer’s stock picks. There will be Inverse Cramer ETF with the ticker SJIM and a Long Cramer ETF with the ticker LJIM.

These ETFs will represent ‘short Cramer’, which essentially means betting against him. Jim Cramer was not pleased with this ETF as his expressive reaction on Twitter shows.

The principal investment strategy of Inverse Cramer ETF will be following according to the prospectus:

“The Fund is an actively managed exchange traded fund that seeks to achieve its investment objective by engaging in transactions designed to perform the opposite of the return of the investments recommended by television personality Jim Cramer (“Cramer”). Under normal circumstances, at least 80% of the Fund’s investments is invested in the inverse of securities mentioned by Cramer.”

These ETFs will be influenced by everything Jim Cramer does, meaning if he recommends buying some stocks, short positions will be added to Short Cramer ETF.

“The Fund’s adviser monitors Cramer’s stock selection recommendations throughout the trading day as publicly announced on Twitter or his television programs broadcast on CNBC, and sells those recommendations short or enters into derivatives transactions such as futures, options or swaps that produce a negative correlation to those recommendations. The Fund’s portfolio generally is comprised of 20 to 25 equity securities not recommended by Cramer,” the prospectus states.

Read more: Correlation of Bitcoin and gold reached 12-months high

Tuttle is clearly following his ideas as he already took down a well-known ETF investor Cathie Wood. Now he wants to go on Jim Cramer. 

Long Cramer ETF

On the other hand, if Jim Cramer thinks some stocks will rise, long positions will be added to Long Cramer ETF. So yes, people can trade both directions of Jim Cramer’s ‘hot tips’. Which one will be more successful will be visible soon.

“The Fund is an actively managed exchange traded fund seeks to achieve its investment objective by engaging in transactions designed to replicate the investment returns of those investments recommended by Cramer. The Fund invests at least 80% of its assets in securities mentioned by Cramer,” the prospectus states.

This may be another very interesting way of investing and trolling a famous TV personality as well. Now people will see how Jim Cramer actually performs as ETFs will track his investment preferences. 

I got into financial markets by accident in 2012 and started with Forex trading. Later in 2017, I started investing in stocks in cryptocurrencies and began writing articles profess...


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