Awful Stocks Have Entered Their Sweet Spot

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Eighty percent of the time, buying awful stocks of awful companies leads to losing huge amounts of money. No, make that 90% of the time. But we are in the remaining 10% of the time right now, and the professionals all know it.

We are in that moment where you could buy anything -- Ariba (ARBA - commentary - Cramer's Take), Ask Jeeves (ASKJ - commentary - Cramer's Take), Art Technology Group (ARTG - commentary - Cramer's Take), Akamai (AKAM - commentary - Cramer's Take), Inktomi (INKT - commentary - Cramer's Take) -- I mean anything, and make money.

Who buys this gunk? Who plays these silly games, stocking up on stuff that stinks in order to make a buck or two?

I don't know who does it now. I can tell you, though, that I used to do it aggressively. I hated myself for it. But I did it. Religiously. And I almost always made money doing it, provided I was operating in that small window that we're seeing again now.

Why does it happen? Why does it work?

Because this is a supply and demand game. That's all it is, nothing more. Here's how it works: For the past few months, some of these companies' stocks have been for sale every day through various brokers as mutual funds liquidate these positions. Every morning these brokers will read off their lists of merchandise for sale. People like my wife, when she ran the trading desk, would take these lists down. Every day we would hear that Ariba, for instance, was for sale from, say, Remarc Brokers.

Then one day, it wouldn't be on the list.

That would be your chance to pounce, provided you could stomach owning Ariba for a few hours.

Some people never can do this. They look at the financials or they listen to the last conference call and they say "I can't own this for a nanosecond."

Those people are purists. I can't stomach purists. This is a game of making money.

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James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS by clicking here. While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column to [e-mail]. Click here to get Cramer's book, "Confessions of a Street Addict."