Investors May Soon be Able to Bet Against Jim Cramer

By now, most of us are familiar with Jim Cramer.

But what you may not be aware of is a potentially new fund, designed to trade the opposite of what Jim Cramer recommends on his CNBC show.

Just yesterday, “Matthew Tuttle of Tuttle Capital Management filed a prospectus with the Securities and Exchange Commission for an exchange-traded fund that will bet against the stock recommendations made by Jim Cramer. The idea of a fund that would do the opposite of what Cramer suggests has been a running joke on social platforms like Reddit, where users have periodically ridiculed him for his market views,” as noted by Barron’s.

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.

The Fund’s adviser monitors Cramer’s stock selection and overall market 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 goes long on stocks or ETFs that represent sectors that Cramer is negative on. The Fund uses Index ETFs and inverse Index ETFs to take the opposite side of Cramer’s announced market view.

The Fund’s portfolio is comprised generally of 20 to 25 equally weighted equity securities of any market capitalization of domestic and foreign issuers. If Cramer does not take any view on any of the securities in the Fund’s portfolio, the adviser retains discretion to sell positions once profit or loss targets are met, or market conditions such as large swings in either direction necessitate a sale and replace them with securities that meet the criteria of the Fund’s initial portfolio. Under normal circumstances, the Fund will hold positions no longer than a week but could hold position longer if Cramer continues to have a contrary opinion.”