CNBC's Jim Cramer said Tuesday it's not too late for new investors to take profits in high-flying technology companies that helped power the stock market's run-up in recent months and are now leading Wall Street's major reversal.
"I implore the people who are newbies, do you know what you own? Do you know why you own it? Do you own it just for momentum? If that's it, sell," Cramer said on "Squawk Box." "These people who are just in there because they think stocks only go up, they are the ones who are going to get hurt."
Cramer's comments come as major tech stocks were again under pressure in early trading. Last week, the tech-heavy Nasdaq Composite fell 3.3% in its worst week since March 20, driven by pullbacks in market-leading stocks such as Amazon, Apple, Microsoft and Facebook. The market was closed Monday due to Labor Day. Nasdaq futures were plunging over 3% Tuesday.
The "Mad Money" host also advised young investors Thursday to take profits, saying the only way to make money after the market's robust rally from coronavirus-era lows was to "take something off the table."
The coronavirus pandemic has attracted a wave of new investors into equity markets, seeing the big sell-off in late February and into March as a buying opportunity.
On Tuesday, Cramer said his call for first-time investors to sell was rooted in the history of the dot-com bubble, which began in the mid-1990s. From 1995 until the bubble burst in March 2000, the Nasdaq rose more than 500%.
"We didn't scream 'sell' enough in 2000. We can't do that now," Cramer said. "You should've sold then and therefore, maybe you should have sold now."
Later, on "Squawk on the Street," Cramer said people who made fortunes on paper by investing in hot tech stocks during the dot-com boom saw their gains disappear when the market sold off.
"I remember in March and April of 2000, I remember what it was like. I know there were a lot of people who said, 'You know what, I'm a millionaire. I'm not going to pay taxes,'" Cramer said. "These people lost everything."