You just can't beat stocks that sell for $5 and go to $200. They are truly what draws many individuals to the stock market. They are winning lottery tickets. They are the three coins inserted into the right slot machine that magically produces a $1.2 million windfall. But most of the time, they don't happen.
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Oh, you hear about them, just like I heard about that lucky $1.2 million winner at the
Trump Taj Mahal
in my bulletin from that casino. But their sheer existence inspires people to do the wrong thing: buy tons of state-sponsored lottery tickets in a futile attempt to hit big, or plunge hundreds of dollars into slot machines hoping to get really lucky, or put down hard-earned money on some crummy $2 stock thinking it is the next
I know about it; I get asked about it all of the time. Take this heartfelt letter from
, a paid-up subscriber: "I don't have a lot of money to work with and all I hear you talk about are stocks that sell from $1000 to $400. I simply cannot afford to buy these stocks. I have seen a lot of talk about
B2B stocks. Can you comment on some that the little guy can afford? Go out on a limb and talk about some of the smaller guys that have potential."
First, Gary's right. If these exist and I know of them, I should share them in the same way I ask you to share your insights on our
message boards. Second, "Go out on a limb?" Sometimes our readers have no idea how far out on a limb I am with this column. I am exposing myself to a heap of scorn, ill-will and general criticism from just about everybody. And yet I would
go out even further if I had just the kind of stocks in mind that Gary is looking for.
But the simple truth is -- I don't.
I don't write positively about stocks that I would not consider buying or owning myself. I don't have any B2B plays that fit this description. I am not holding out anything.
You know, before I go on that incredibly cool "Fox & Friends" show on Fridays on
Fox News Channel
, where I just came from, I always go over what I want to discuss with the good folks who put together the show. I always make the same point. I want to talk about exactly what I like and what I don't like and I don't want to hold anything back. Too often in my career, I have seen managers keep the best ideas for themselves, as they have no desire to share them with viewers, readers, or even their own investors!
Me, I don't play it that way. You get what I know. If I knew a $5 B2B play that was interesting, it sure would have come out in our
B2B rotisserie league, which was my attempt to share even the rawest of data with you. Ahh, but doesn't that mean I am not about leveling the playing field because I am unwilling to "comment on some that the little guy can afford?" Not at all. Nothing would make the playing field more uneven than talking positively about stocks I don't like just because they have a great price-point. I would rather see you own two shares of a great stock than 100 shares of a crummy one.
Everyday I wrestle with saying and doing the right thing on the site. Is such and such a stock "too small" to write about. Is this stock a real keeper or a flash in the pan? Should I even bother to mention a stock if I have no intention ever of owning it or shorting it?
But one thing I never wrestle with: As long as I am attempting to show you the truth about what I like or dislike -- even if it is of the moment -- then I am getting it right. It would not be right to talk about smaller guys that have potential if I don't know any.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long Yahoo!. Cramer's fund also may be long or short certain stocks in his B2B rotisserie league or Red Hot index. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at