EXCLUSIVE: Jim Cramer Recommended SVB Financial In February, An Example Of 'His Reverse Midas Touch'

Zinger Key Points
  • Two ETFs were launched in March to give investors a way to bet against Jim Cramer.
  • Cramer recommended buying shares of SVB Financial around one month before the bank was shut down by regulators.

SVB Financial Group SIVB-owned Silicon Valley Bank — which was shut down by California regulators Friday and taken over by the Federal Deposit Insurance Corporation as receiver — was previously recommended by Jim Cramer during a “Mad Money” segment on Feb. 8, 2023.

In the segment, Cramer identified 10 stocks in the S&P 500 that had increased significantly in 2023, but that he said were still worth grabbing at the right price.

“Consider me intrigued, but only if we have a couple more down days like today that give you a better opportunity because these stocks have all been overbought,” Cramer said.

The desire to bet against Cramer has been present for years, and with a call to buy one of this week’s hardest hit stocks coming from the CNBC host just one month ago, a new set of ETFs that allow investors the ability to bet for or against Cramer's stock recommendations could increase in popularity. 

Cramer's SVB Thesis Ages Poorly: Cramer told viewers that SVB Financial had bought one “of our favorite” research firms, MoffettNathanson, making the company less dependent on private equity and venture capital.

“Those dried up last year, they could come back,” Cramer said of private equity and venture capital.

The stock was cited as the ninth best performer in the S&P 500 year-to-date at the time.

“I think the fears were not justified. Long term private equity, they’re not going away.”

Cramer called being a banker to the private equity sector an attractive business model.

“[The] stock’s still cheap.”

The stock lost two-thirds of its value in 2022 and needed a bigger move to regain those levels, Cramer said. 

“You could argue that SVB 40% up is barely a drop in the bucket.”

SVB Financial Group's bounce back was far from over, Cramer said. Shares of the stock closed at $320.40 on Feb. 8 before his show aired.

Related Link: I Want You To Bet Against Me, Jim Cramer Calls Out New Inverse ETF With His 42 Years Of Success

Betting Against Cramer: Tuttle Capital Management launched The Inverse Cramer Tracker ETF SJIM and The Long Cramer Tracker ETF LJIM to give investors a way to go short or long the stock recommendations of Cramer with “one-ticker” access.

“This is something that’s been years in the making,” Tuttle Capital Management CEO and CIO Matthew Tuttle told Benzinga in a March 3 interview on "PreMarketPrep." 

Tuttle said at the time the consensus seems to be wrong a lot, and Cramer represents the consensus.

“(He) swings at every pitch. That’s not a criticism, he has to.”

Tuttle echoed this sentiment when asked about Cramer’s buy recommendation on SVB Financial Group just one month ago prior to its collapse.

“SIVB is just another example of the reverse Midas touch and why there is such a desire to bet against him,” Tuttle told Benzinga.

People who bet against Cramer with the Inverse Cramer ETF might have an unfair advantage since he has to give recommendations on numerous stocks and “swing at every pitch," Tuttle said. 

“Don’t forget he told people to get out of Bitcoin, Coinbase and tech right before they all rallied in January.”

Since launching the two ETFs, the Inverse Cramer ETF has proven more popular, with $6.5 million in assets under management compared to $250,000 for The Long Cramer ETF.

“I think people still view it as a novelty item, but I think they will eventually see it as a powerful portfolio diversifier as you are betting against the idea that the consensus is usually wrong, and Jim is the consensus on steroids.”

Stock Weighting In The Cramer ETFs: Cramer recently said he would be a buyer of Ford Motor Company F “hand over fist.” When asked what a comment like this means for the allocation, Tuttle shared insight into the weighting of the stock.

“When he does talk about buying hand over fist we could have a larger position, [it] just depends on the overall portfolio.”

The holdings of the ETFS are updated daily on the Cramer ETFs website and through a daily email showing the trades of each day.

Read Next: With SVB Financial On Life Support, Analysts Downgrade Stock: 'Too Much Uncertainty'

Photo via Shutterstock. 

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Posted In: Specialty ETFsTop StoriesExclusivesMoversTrading IdeasInterviewETFsbank stocksbanksCNBCFDICJim CramerMad MoneyMatthew TuttleS&P 500
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