Jim Cramer’s Market Sell-off Playbook

Jim Cramer shared his strategy for the recent market sell-off, highlighting key points for investors:

Identify what's actually wrong: The epicenter of the damage was Japan, not the U.S., so don't call a bottom yet.

Analyze what people think is wrong: Sellers are ill-advised, driven by fears of the Fed not cutting rates, overvalued tech stocks, and Buffett selling Apple shares.

Figure out what you can buy outside the epicenter: Use the sell-off as a buying opportunity for stocks outside the blast radius, like banks. Cramer likes Morgan Stanley for its 4% yield and future acquisitions.

Keep cash on hand: Have ample cash ready for further declines. Don't put all your money to work at one level.

Wait until the market is oversold: Only invest heavily when the market is truly oversold. Cramer suggests a minus 5 rating on the S&P Oscillator as a sign.

Consider upcoming market events: Be aware of looming market events but note that commercial real estate fears seem overdone, and Cramer isn't worried about election year uncertainties affecting business.