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Jim Cramer doesn’t beat the market

Jim Cramer joked to MarketWatch that being portrayed by George Clooney in the movie “Money Monster” is “a win in my book.“

CNBC TV personality and “Mad Money” host Jim Cramer has built a lucrative career as a stock picker, but a new analysis of his charitable fund—a personal stock portfolio he co-manages that the financial website he founded has built a subscription service upon—shows he doesn’t beat the market.

Cramer’s Action Alerts Plus portfolio has underperformed the S&P 500 index SPX, -0.85% in terms of total cumulative returns since its 2001 inception, according to a working paper released Friday by Jonathan Hartley and Matthew Olson, researchers from the Wharton School at the University of Pennsylvania. While the fund outperformed the 500-member index in the years leading up to the 2008 financial crisis—which Hartley said was partially a reflection of the fund’s previous inclusion of small-cap companies and growth stocks that were outperforming during the pre-recession bull run—things have gotten worse since 2011, with Action Alerts Plus falling 9.5% in that year, when the S&P 500 was unmoved. It rose just 1.3% in 2014, versus an 11.4% increase for the S&P, the study found.

The Wharton researchers released the report Friday to coincide with the release of the new film “Money Monster,” which stars George Clooney as a financial news host with a show similar to “Mad Money.” In the film, a less-sophisticated investor named Kyle Budwell takes Clooney’s character hostage with a bomb vest after losing all of his money because of a bad stock recommendation made on TV.

The Action Alerts Plus portfolio, which is used in part by Cramer and TheStreet.com to sell $15-a-month newsletter subscriptions that provide subscribers information about the fund’s holdings, its buy-and-sell strategy and exclusive market commentary from Cramer, was found to have returned 64.5% cumulatively over the past 15 years, versus 70% for the S&P 500, when adjusted for the reinvestment of dividends, according to the Wharton researchers’ study. The Vanguard Diversified Equity Fund, by comparison, a mutual fund composed of a blend of U.S.-based companies, has underperformed the S&P 500’s total return by 0.8% over the last 10 years, according to Morningstar.

In addition to co-managing Action Alerts Plus, Cramer is the founder of TheStreet Inc. TST, +0.00% and one of six directors on the company’s board. He has hosted his CNBC financial show on weeknights, recommending individual stocks to buy...


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