Dr. Duru

Cramer's Stop Trading! Costco Comes Back (10/7/09)

Interesting that COST is also showing a spike in healthcare costs: inflationwatch.wordpre.../

Is Jim Cramer Right? Is Apple Really a Market Barometer?

I did use a one-day delay and results worsened. Both charts show those results. The correlations also include a look at 1-day time lag. I stopped there because I saw nothing that told me it was worth the time to make this analysis even more complicated. Cramer presented no evidence of predictive power (outside of one trading day where the S&P futures were limit down in the pre-market), and I thikn it's dangerous to base investing advice and especially trading advice on "spirits." I would love for someone to take this analysis a step further, but I doubt it's worth anyone's time to do so given what we see here.

What didn't make this copy of my original article is that I also recognize that this analysis does not tells us whether AAPL performs better than any other stock as a market barometer. If that were the case, it is also understandable why Cramer could make the mistake he did.

On Nov 09 08:47 AM win wrote:

> I think Cramer may have been speaking of Apple's predictive value.
> Simultaneous price correlation and the other tools you use would
> be useless to assess this metric. Instead, I would use a delay of
> one day and assess AAPL's price correlation with the SP, then 2 days
> and so on up to 5 days. Then I would do the same on a weekly chart.
> That is one way of measuring predictive value.

Time to Nibble on Tech - Barron's

Nice. And this buy the bottom call comes on the heels of another bearish Barron's article knocking GOOG to $350...