Cramer's 'Mad Money' Recap: The Beauty of Diversification (Final)

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After today's somewhat confusing employment number, Jim Cramer told the viewers of his "Mad Money" TV show that diversified portfolio is the way to play the markets going forward.

He said investors need to understand the context of employment number to really understand where the markets are headed.

Cramer said today's employment number was all about expectations. The top line under of 9.4% unemployment is indeed a bad number, he said, but it's far better than the garden variety depression many experts forecast just a few month ago.

Cramer said American business took swift action last year when they saw the economy worsening. They laid off huge numbers of people fast to save their bottom lines. Now, with the government's handling of Chrysler and GM also going better than expected, the worst is likely behind us, he said.

According to Cramer, the recession is not over, which is why he continues to recommend sticking with the leaders that have been working, mainly the banks, oils, tech and now aerospace.

In these groups, Cramer likes JPMorgan Chase (JPM Quote) and Conoco Phillips (COP Quote), two stocks which Cramer owns for his charitable trust, Action Alerts PLUS, along with Apple (AAPL Quote) and Boeing (BA Quote).

Cramer also recommended adding a few defensive names to investors' portfolios, names like Agnico-Eagle Mines (AEM Quote) for gold exposure, and Johnson & Johnson (JNJ Quote) and Colgate-Palmolive (CL Quote).

By using a diversified portfolio, Cramer said investors will find themselves at a great place in a confusing market.