Click here for the latest from James J. Cramer.

Instead of just giving you thumbs-up or thumbs-down recommendations for stocks, I want to show you how to identify and analyze interesting situations on your own, using my experiences as a hedge fund manager as a guide. While at the hedge fund, I was loath, for competitive reasons, to detail how I reached my conclusions, particularly on small-capitalization names. Now, I have no such restrictions. Divided into three sections -- The Prey, The Hunt and The Take Down -- this new, occasional feature will show you how to stalk and bag some of the juiciest stories out there.

Related Stories

Big Game Hunt: Part 2

Taking Cramer's Stress Test

Anatomy of a Blown Trade: Part 1

Cramer Analyzes the Analysts

Buy and sell ideas hit my desk constantly at this new job, as they did from my perch at Cramer Berkowitz. However, there is one difference. Previously, suggestions, almost all long-side ideas, came from my brokers at Cramer Berk. Here they come mostly from hedge fund managers, and, as you might guess, they aren't all from the long side. In fact, most are from the short side! (I read them all, so don't be bashful about sending your ideas about stocks in. I love talking about these ideas as much as ever and am looking forward to some organized get-togethers where we can swap the best of them.)

I now get ideas from the hedgies out there because I am no longer a competitor. In this new job, I am an ally, not the enemy, and hedge funds know that I will research their ideas and, perhaps, reach different conclusions from their own. That's the chance they take.

The Prey

But first, let me tell you how I approached these things at Cramer Berkowitz -- and why it's more fun to do the sort of detective work I do below in my new incarnation as a strategist.

First, I would go to my Bloomberg machine, call up the news and get the simple Bloomberg description and market cap. Bloomberg offers the fastest, best data and I love it. I would have taken one look at a BioTime, seen that it only has 11 million shares and I would have said, "Next!" That was just too small for Cramer Berk. I couldn't make it work. I'd buy 25,000, and I'd move it. I'd sell 25,000 short, and I'd move it and then I'd get killed if a short squeeze developed. I didn't have time for this small a capitalization because I ran too much money. But there was another time, before my hedge fund got too big, where this type of idea would have had me going crazy with excitement. At that time, I would have analyzed the stock within an inch of its life before making an investment decision.

When the hedgie drew my attention to BioTime last week, my first thought was, heck, something seems wrong here, because this story keeps coming back from the dead. My antennae were up immediately because this stock had just been pushed, and pushed hard, by Jono Steinberg in his "Magic 25" for Individual Investor magazine. The short-seller even pointed that out to me. I thought to myself, "I have heard of this BioTime," and sure enough, I remembered that this was the stock Steinberg had recommended in his magazine and then sold at his hedge fund right into the hoopla. He had such a big position he couldn't hide the sell filings! It's OK, though. He apologized. But the stock got crushed beyond recognition.

I figured, wait a second, Steinberg wouldn't go back to this poisoned well a second time if BioTime didn't have something. I was further intrigued and a bit flummoxed when I saw -- in the holders list that Bloomberg compiles from available federal filings -- two of my favorite investors: Blue Ridge Capital and Al Kingsley. (I know the people at Blue Ridge well enough that I could have called them, and would have in my old digs, but now I am trying to do my research like a regular retail investor.) Holder filings are so old -- you can wait six months to file them, and I have never heard anyone get in trouble for being later -- that Blue Ridge might have blown it out already. Who could blame them after the move this stock just put on after its inclusion in the Magic 25?

Kingsley is a different matter. I met Kingsley -- not that he would know me from Adam -- about 15 years ago when he was working for Carl Icahn. He was sharp and disciplined then. He was at Icahn's side for a number of high-profile deals (and not all of them turned out like some of the junk-bond rot that Icahn's caught lately). Who knows, maybe Kingsley has lost his edge since those days. Guys lose their edge all of the time. Especially after making a pile of money. Kingsley did get hammered in that nasty Outboard Marine bankruptcy that just got filed. (He led the leveraged buyout of the boatmaker.) Then again, who would have thought this down cycle would be so grim. Anyway, I don't expect Kingsley would buy into some fly-by-night outfit.

That made me think BioTime may be in the potential long-on-a-pullback camp. (Yes, I am easily swayed when I see someone I respect buying a stock.) So I read the readily available press clippings, including Individual Investor's logic behind the push. Looks like BioTime has some sort of a synthetic blood, called Hextend. Synthetic blood could be huge. I recall in a different decade a company called Daxor, which spiked gigantically because it banked your own blood; all of the problems with blood contamination made this viable. Hospitals are always running short of blood, so I am all ears.

Maybe there's something here. I make a note that I have to find out about how big this Hextend is and how big the company claims it is. If it is big, maybe I should go long. If it is not big, and they have hyped it big, then maybe I should go short.