I watch Jim Cramer's show, Mad Money, and I like him mostly for his entertainment value. However, if you watch him long enough you can find some investment "nuggets."

The general theme of this article is that the real tech stock winners are cloud stocks and not FANG stocks. The term is now FAANG: Facebook, Amazon, Apple, Netflix & Google.

I buy information technology (IT) stuff (servers, storage, software, telecom, services, etc.), among other things, for my company. It is true that most IT solutions are either in the cloud or moving to the cloud.

If you're not familiar with what the cloud is, there is a simple, but not complete, explanation. It is basically an IT solution or technology that is hosted in someone else's data center. This approach allows a company to free up their capital investment dollars to be used elsewhere since it does not have to buy the IT hardware, software, etc. and put it in its own data center. There are several other advantages, but we can address those in another post.

In this case, I generally agree with Jim Cramer about these technology stocks. However, Amazon, which is a FANG stock, is big into cloud computing, along with Microsoft. This means that many companies buy cloud capacity or infrastructure in Amazon's or Microsoft's data centers instead of procuring their own, inside their own data centers.

However, no matter which stock you buy, you should buy it at a good value (i.e. a good entry point). Don't just jump on the bandwagon and buy when everyone else is buying a certain stock. You also need to compare a stock's fundamentals and technicals with other stocks in their own sector. For example, you can't compare a utility stock and a cloud stock.

Of course, if you're reading this, then you don't have to worry about how to compare stocks or when to buy or sell because you are reading Sean Hyman's website. I can fully attest, since I know Sean well personally, that he will always tell you the truth and will always put your best interest, and not his, first. Plus he's brilliant when it comes to investing in stocks, commodities, currencies, options, etc.

Comments (1)
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Sean Hyman
Sean Hyman

Editor

So, my commentary that I'd add is that Russ is a seasoned investor and can more easily separate the wheat from the chaff. But Cramer will hype overvalued, overpriced momentum stocks that would be bad for those not seasoned and able to separate the two. It would confuse most (just like litening to all of the commentators on financial TV).

So this really depends upon your experience level. Also, I'd say that Russ has done well picking stocks and most people typically don't do that well. Also, Russ is an information junkie. Ha-ha. Not much gets past him. So he has many edges as an individual investor, that many wouldn't normally have. But it's also why I appreciate Russ's commentary on the site so much because his thoughts do add some great value.