Cramer's 'Mad Money' Recap: Heavily Hyped and Shorted

This almost always means there's some negative piece of information concerning the stock that the company and analysts are not talking about, he said. It's not inside information, but it's information that the bulls would be more comfortable ignoring.

Cramer said what happened with NutriSystem (NTRI Quote) provides an example of what can happen with a heavily hyped stocked that's loved by analysts love but also has a huge short interest.

It turns out the company had a "big problem" with its distribution model, information that was not emphasized, but which the shorts knew about.

Cramer's fifth and final rule states that "past performance is not indicative of future success." In other words, if people have made a lot of money playing a particular trend, or by investing in a "hot industry," then their natural instinct might be to keep finding new ways to play that trend, Cramer said.

However, as "every investment is different," he urged people not to let their success to make them "overconfident" or to "feel invincible."

"Don't let the fact that one stock has made you money influence your decision to buy a similar-looking stock," Cramer stressed. "Stocks have no memory and you could lose big."

If market players follow these five rules, along with Cramer's older ones and his 15 other new ones, they should be able to make themselves some mad money, he said.

Want more Cramer? Check out Jim's rules and commandments for investing by clicking here.