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Resist Tempting Tanker Yields

By Jim Cramer

About this article:
Frontline and the rest of the big tanker stocks have yields that are can't miss, right? I don't think so. Bloomberg has a great story this morning about how the excessive building in tankers could lead to repossession of the giant ships when the new fleets, the biggest additions in 50 years, hit the market. Big yields are always seductive. I got caught up in one two years ago, Fording Coal, 12%; can't miss. But there's always a price to be paid for these things, and an outsized yield is often more of a red flag than a opportunity. I can't tell you how many times people asked me about these stocks on "Mad Money" when oil was going up. They figured rates had to go up. But these tanker stocks are levered to tanker building's supply and demand, not oil prices. Now oil prices are plunging and tanker rates are...

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