Jim Cramer’s New Book

Let me start by saying that I have not yet read through Jim Cramer’s new book: “Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)”. I have, however, read through the excerpt that Amazon provided and there’s one particular sentence that makes me concerned for those taking his advice without obtaining a second opinion.

I am well aware that many skeptics (myself included) don’t like the way Jim Cramer promotes trading rather than investing, but I didn’t think he would be so rash as to claim the following, taken from the Amazon excerpt (linked above):

“Too many books about money go wrong because they try to offer timeless advice. There’s no such thing as great timeless advice.”

Say what, Mr. Cramer?! No such thing as great timeless advice? That’s the biggest load of… well you know… that I’ve ever heard. In fact, it is my contention that the only good investment advice is timeless advice. The rest won’t help you 10, 20, 50 years from now. But the question remains; what exactly qualifies as timeless investment advice?

Having studied Benjamin Graham and Warren Buffett, as well as a slew of other prominent investment figures, I have found a tremendous amount of timeless investment advice. Benjamin Graham’s book, “The Intelligent Investor,” is bursting at the seams with such advice. Why would Warren Buffett, arguably the greatest investor of all time, say that even today the book remains the “…the best book on investing ever written,” if there was no such thing as timeless advice? For those of you who don’t know, Graham wrote this book in the early 1970’s. Has a lot changed in the last 30-some years? Certainly, but the book is still in circulation, widely regarded as the best investing book ever written, and its principles still utilized today.

1. Be patient

Most successful investors didn’t get rich overnight, so you should not expect to. The more patience you utilize when investing, the far greater your returns will be. Can you make money day-trading? Sure, but you can (and most likely will) lose a lot. Just ask anyone affected by this.

When you invest, you’re buying ownership in a company. If you did your own due diligence and feel comfortable holding the investment for 5 years, you are well on your way to being a better investor.

2. Do your own research

Don’t buy Wall Street hype. Investigate the investment the same way you would investigate buying a new house. Would you rely on a sell-side real estate agent to do your due diligence for you? Certainly not, and you should use the same strategy to invest your money.

Freund Investing Managing Member Ryan Freund holds no position in any of the companies mentioned in this article. Freund Investing has a solid Disclosure Policy.