The Motley Fool Stock Advisor and Rule Breakers programs are among the world's most highly regarded stock picking services. Launched in 2002 and 2004, respectively, hundreds of thousands of investors rely on the picks of Tom and David Gardner every month to make their next moves.
Despite this, some Motley Fool investors are either skeptical or downright dismissive of the product. Although our Motley Fool review has been highly positive about the quality of the platform, we think it’s only fitting to go through some of the most common complaints in a fair and balanced manner.
Let’s dissect some of the most prominent negative reviews about the Fool and its stock-picking programs.
“I Lost Money with their Stock Picks”
The Fool is not God. The Gardner brothers are not market insiders, and they’re not colluding with Wall Street. The fact is that sometimes they get it wrong.
What makes the platform so effective at what it does is its model. All members are recommended to be willing to hold their stock picks for between three and five years. The ideal portfolio will consist of a minimum of 25 recommended Motley Fool stock picks.
Using these figures, the Stock Advisor program has returned 637% since 2002, as of this writing. Compare this to returns on the S&P 500 of 148%.
Even when they do take on losses, the profits from other recommended portfolio picks should dwarf them.
The fact is if you throw all your money into a single stock, you may well lose money. In 2022, the market is volatile, and the pandemic is only driving this further. Even the most renowned of stocks are experiencing massive turbulence, and you need to be willing to push through that.
“The Program is Prohibitively Expensive”
Some people point to the fact that paying $199 per year for a few stock picks is too expensive for what you get. At Modest Money, we disagree. Did you know that the average cost of a financial advisor ranges from $2,000 to $7,500 per year?
This is essentially what you receive with the Fool. A financial advisor will simply recommend investments for your portfolio, but the quality of each advisor varies wildly.
Only with the Fool can you gain access to guaranteed results. Its current track record of over 20 years speaks for itself.
Furthermore, you only pay $99 for the first year, with the option of a 30-day moneyback guarantee. This price applies to anyone, regardless of their portfolio size.
“The Gardner Brothers are Market Makers/Insiders”
Believe it or not, this is one of the most common points found within negative reviews of the Motley Fool.
The short answer is this is nonsense spouted by bad investors and conspiracy theorists. Logically, the Gardner Brothers have no reason to be pulling the wool over anybody’s eyes. If they were taking advantage of investors to enrich themselves, it would have become apparent years ago.
The Fool’s future relies on investors making positive returns. Without producing results, the Fool would have fallen into bankruptcy years ago. No market scam can last this long without discovery.
“The Motley Fool Told Me to Sell Early”
Nobody can accurately predict the market. The market moves according to something and nothing. Although the Fool advises members to be willing to hold their shares for between three and five years, sometimes things change.
For example, if a company was chosen as a recommendation due to their dynamic founder, this change matters if the founder suddenly steps down.
You shouldn’t be concerned about early sell alerts. It doesn’t make them wrong; it makes them diligent. It would be more worrying if they didn’t issue early sell alerts.
“Stock Recommendations Cause Turbulence in the Market”
This one is partly true. Whenever the Fool recommends a company, especially a smaller one, it can cause the share price to spike. Likewise, if they issue a sell order, it could cause the share price to tumble. We’ve seen this in the past.
However, these changes in the market rarely cause any lasting changes to a company’s stock price. Turbulence caused by the Fool’s activities typically resolves within a few days.
“Too Much Advertising”
As much as we love the Motley Fool at Modest Money, this is the one complaint we’ll uphold. The Fool’s marketing machine does use pressure techniques to encourage users to upgrade their accounts to more expensive subscriptions.
Subscribers can expect numerous emails with helpful information and marketing emails telling them about other programs. However, note that it is possible to opt out of promotional emails.
Thus, while this is a minor complaint, we understand why this can get to some users of the Motley Fool program.
“Aha! Motley Fool Asset Management Proves that the Fool is a Scam!”
Perhaps the most frivolous complaint that regularly comes up. Motley Fool Asset Management is the sister company of the Fool and holds lots of stocks and ETFs. Some people claim this proves that the Gardner Brothers are deceiving retail investors on behalf of hedge funds.
One particular TrustPilot complaint even went as far as to claim that the platform issues sell orders for stocks that the Fool wants to short and buy orders for stocks they are going long on.
The truth is the Gardner Brothers are rich men and housing their assets within a company allows them to save millions on taxes. That’s not proof of a scam. It proves they’re not stupid.
Ignore the conspiracy theorists. The Fool’s long-term results speak for themselves.
Conclusion – Should You Trust the Motley Fool?
Our Motley Fool review proclaims this to be the single best stock picking service available now. We maintain that the Fool is still the best stock picking service. Most complaints have no factual basis or are wrapped up in kooky conspiracy theories.
Right now, you can take advantage of the Fool’s introductory offer. For your first year, you can take advantage of their Stock Advisor program for just $99.