Source

“Mad Money” investing advice - How good is the advice?
Ever watched the TV show “Mad Money”? It is not only the money that is mad, but the whole show is a caffeine-packed rollercoaster. But I guess that is what part of the facination about the show is.

But how accurate is the stock tips you get on this show?

Quote: “The Web site Yourmoneywatch.com, tracks Cramer’s “buy” tips and tabulates the performance of all of the stocks he has advised buying until he advises selling.

According to “Yourmoneywatchâ€?, since it started tabulating on July 28, 2005, Cramer’s “buy” rated stocks have averaged a 7 percent return compared to 5 percent or so for the NASDAQ, which is probably the most relevant index. However, the site calculates the returns starting with each stock’s closing price the day that Cramer advised buying. Since many of his picks open higher the next day, the first chance most investors would have to act on his advice, your actual returns would be lower.

So, while Cramer’s picks, on average, have beaten the market, the results won’t knock your socks off. ”