The Motley Fool is a financial services firm based in Alexandria, Virginia. The company was founded in 1993 by brothers Tom and David Gardner.
The company first gained notoriety in 1994 with an April Fool’s joke where it promoted a sewage disposal company through message boards.
The problem? The company didn’t actually exist.
Tom and David wanted to teach people a lesson about the dangers of investing in penny stocks. Clearly, the stunt worked, as it was picked up by several big-name outlets, including The Wall Street Journal.
After that, it published various guides and investment advice through mediums such as AOL in its early days.
In 2002, it launched what would become its flagship investment advice service known as Stock Advisor. The bread and butter of the service has always been its two monthly stock picks, which it sends via email on the first and third Thursdays of the month.
However, it includes plenty of other valuable features, such as a starter stocks list, best buys now, and in-depth stock analysis. And now, it even maintains a list of exchange-traded funds (ETFs) in its Best Buys Now section for those who prefer easier diversification.
You really can’t go wrong for the price. Speaking of which, the normal cost of an annual subscription to Stock Advisor is $199 ($16.58 per month).
However, we have a special deal for you: instead of $199, if you join Stock Advisor using our link, you’ll pay just $89 for your first year. That’s less than $7 per month!
The Motley Fool Returns
You probably want to know what kind of returns you can expect from Stock Advisor. Fortunately, Fool publishes exactly the average return for all of its picks since inception. The figure is updated frequently, but right now, it’s over 600%.
Of course, the service has been around since 2002, and you could say they have been “lucky” enough to pick Netflix way back in 2004.
While picks like those were undoubtedly great ones, that doesn’t mean they were lucky. As mentioned, The Motley Fool’s team studies each stock at great length to ensure it’s a quality company primed for success.
I started a portfolio of Stock Advisor stocks using M1 Finance in June 2020, and the results have been fantastic. So far, my return is better than 575% in that short time:
In other words, my results have been nearly as good as Stock Advisor’s average return even though we haven’t exactly seen the next Netflix. (Sorry, Peacock.)
Of course, I have been invested a little over a year, but to have a nearly 6x return in about 16 months is excellent.
The Motley Fool Epic Bundle
As a standalone service, Stock Advisor provides excellent value for individual investors. However, the Fool offers more than one service for stock recommendations; it even offers services that can double as investment strategies for retirement planning!
That said, it becomes quite costly if you decide to get your portfolio guidance through separately-purchased Motley Fool subscriptions. Fortunately, the Fool has come up with a cheaper alternative that allows you to save money while addressing multiple financial goals at the same time: it’s called the Motley Fool Epic Bundle!
This bundle contains four of the Fool’s subscription services: Stock Advisor, Rule Breakers, Real Estate Winners, and Everlasting Stocks. Individually, these services would add up to a grand cost of $1,046. However, you can purchase the Epic Bundle for only $499 per year.
Sure, you’ll still be paying the price of an additional subscription (when compared to the standalone price of Stock Advisor). Nonetheless, I think it’s worth looking into since you essentially get two additional subscriptions—and their fantastic portfolios—for free.
I’ve already gone over most of the details of Stock Advisor in this article, but—since it’s part of the Epic Bundle—I’ll do one more quick overview!
Stock Advisor is Motley Fool’s flagship offering. Costing $199 per year (at full price), the service provides investors with monthly stock recommendations that they can then add to their investment portfolio.
Stock Advisor’s portfolio recommendations are primarily chosen with the amateur investor in mind. These stocks should provide good returns, providing you keep them in your portfolio for a minimum of three years (as recommended by Motley Fool).
Historically, Stock Advisor has been very beneficial for long-term investors, with an average return of 358% (as of Nov. 1, 2022).
Rule Breakers is Motley Fool’s growth stock picking service. Unlike Stock Advisor—which provides relatively safe monthly stock recommendations—Rule Breakers hones in on more risky stocks with a higher earning potential.
These disruptive stocks don’t perform as well overall as the portfolio recommendations from Stock Advisor. This is likely because to be a “disruptive stock,” the share has to be from a company with the potential to initiate change. As we know, change doesn’t happen overnight, and sometimes, you take one step backward before you take two steps forwards.
That said, the individual stocks that do that off easily outperform the stock market. One semi-recent stock recommended by Rule Breakers was Tesla. Since Rule Breakers first recommended the stock, it’s offered a return of 12,551%. While it’s unrealistic to expect all the Rule Breakers stocks to be warning, it’s fair to say that the ones that take off balance out the ones that fall flat.
While Rule Breakers is technically appropriate for investors of all experience levels, we’d recommend at least getting a bit of trading experience under your belt before giving it a try. It’s best for long-term investors who are seeking to diversify their portfolios. However, you should never rely on Rule Breakers for your entire portfolio.
Real Estate Winners
Diversification is an important part of successful investing (especially if your retirement planning revolves around your investments). After all, what else offers so much protection against massive market changes? Although we’ve already covered two services that offer portfolio recommendations, one asset type has been completely absent: real estate.
Motley Fool does offer a premium real estate subscription for high-capital investors, but most of the best opportunities are only available to accredited investors. Additionally, the service costs a whopping $2,499 per year, which is a far bigger commitment than the average amateur investor is likely willing to make.
Fortunately, the Fool also offers Real Estate Winners, a more affordable subscription with a history of successful investing. This service provides subscribers with one real estate recommendation per month, which could be a REIT, crowdfunded option, or other typpes of real estate opportunity.
When combined with the prior two services, it’s easy to see how the Epic Bundle can help you diversify your portfolio with ease. That said, I always recommend taking the time to look into any investments before you commit.
Whereas most of Motley Fool’s stock recommendation services revolve around the idea of holding a stock for five years or so, Everlasting Stocks proposes an intriguing alternative: what if you could just buy a stock and hold on to it forever?
Although it’s closer to an investment portfolio building service than a stock picker, Everlasting Stock is yet another service offered by the Motley Fool with a history of success. So far, it’s offered returns of up to 578% to the average investor, though its short lifespan makes us wonder about its long-term performance. Still, if it’s anything like the Fool’s other subscription services, we expect that Everlasting Stocks will be another successful investing service that outperforms the stock market at large.
Is The Motley Fool Legit?
At this point, I feel it is safe to say The Motley Fool is legit. Why? One word: transparency.
Fool isn’t shy about its wins, its losses, its ups, or its downs. In fact, one of the things Stock Advisors gain access to is a performance page that shows the returns of every pick the company has ever made.
That includes stocks such as Pacific Sunwear of California with a return of -95%. Or how about Luckin Coffee, which endured a juicy scandal involving fake buyers last year.
Pacific Sunwear was closed way back in 2009, meaning Fool stopped recommending it back then. But Luckin Coffee is still an active recommendation despite a -62.5% return.
All this despite the fact that the program’s average return is still in excess of 600%. They make clear that you buy at least 15 recommendations (sometimes they say at least 30) because these missteps will happen.
Should You Subscribe to The Motley Fool?
Whether you should subscribe to The Motley Fool comes down to what you want from your portfolio. Through Stock Advisor and other services, The Motley Fool allows you to take control of your portfolio and achieve better returns.
Or you can even use their recommendations to invest in a portfolio of individual stocks in M1 Finance to complement your larger portfolio of ETFs/mutual funds. This is exactly what I do. I like the relative safety and stability of index funds, but it’s nice to have a portfolio on the side with more upside potential.
In all honesty, I find it hard to find reasons not to subscribe to The Motley Fool. Not only is it only $89 your first year with our link, there is also a 30-day money-back guarantee.
You might hear some people talk about excessive up-selling from The Motley Fool. However, all of its communication is optional, meaning you can easily opt out of its marketing mailers.
I highly recommend giving it a try and seeing what you think. If you really don’t like it, you can cancel before 30 days. But I doubt you will. And if you don’t, it’s only $89 for the first year. It’s hard to find a better deal than that these days!
Motley Fool Comparisons:
- Motley Fool Stock Advisor vs Rule Breakers
- Motley Fool vs Morningstar
- Motley Fool vs Zacks
- Motley Fool vs Seeking Alpha
- Motley Fool vs Stansberry Research
- Motley Fool vs Oxford Club