Cramer's 'Stop Trading!': Retail ETFs

"If you don't understand the ETF world, I think you're going to be left behind," said Jim Cramer on CNBC's "Stop Trading!" segment on Tuesday.

He said that rather than trade individual stocks, "people want to trade ETFs." And when it comes to retail ETFs, he prefers PowerShares Dynamic Retail(PMR Quote) to Retail HOLDRs(RTH Quote).

There's "too much concentration in the RTH," and Best Buy(BBY Quote) is "controlling" it, he said. The ETF is "not a good judge anymore."

"PMR is the better ETF to trade if you're negative on retail," Cramer said.

As for banks, Cramer said "you have to look at the option market. There's a "gigantic June 35 put position" in JPMorgan(JPM Quote), he said. "If they start selling those puts, that stock could go to $35."

"GE(GE Quote) could hit $12-and-a-half, Bank of America(BAC Quote) could hit $12-and-a-half, and JPMorgan could be driven the other way by the put-selling," he said.