The Motley Fool and Zacks are two popular investing services, both used by thousands of investors around the country. However, what the two services offer is quite different and caters to different types of investors.
At the most basic level, the difference between the two is that The Motley Fool is an investment advice company, while Zacks is a trading platform best-suited to advanced traders. Zacks publishes stock analysis as well, but one key difference is that Zacks is also a broker with its own trading platform.
This may give the impression that Zacks has more to offer, but it's not that simple. For its part, The Motley Fool has a number of investment advice services tailored to specific investing styles. Zacks, on the other hand, publishes more general investment analysis.
So, how do you decide which one is right for you?
Motley Fool Overview
The Motley Fool is an investment advice company that has been around since 1993. It was founded by brothers Tom and David Gardner as a contrarian investment service, or one that went against the grain of mainstream advice.
In other words, The Motley Fool wanted to be different. It also didn't want to take itself too seriously, and it has stuck to that philosophy.
As discussed in our Motley Fool review, the company has several services these days, all of which give you stock recommendations based on a particular investment style. However, Fool's most popular service, Stock Advisor, is also its oldest; it was first launched in 2002.
Investors like Stock Advisor and other services from The Motley Fool because they get great results. They are also fully transparent and many of them are an incredible value. As long as you have a preferred broker to make your trades, it's tough to go wrong with anything The Motley Fool offers.
Motley Fool Details
Stock recommendations, stock analysis, webinars, watchlist, stock screener
The Motley Fool’s most popular service, Stock Advisor, is just $99 for the first year. After that, a Motley Fool Stock Advisor subscription will cost $199.
The Motley Fool provides phone support Monday – Friday from 9 a.m. to 5 p.m. Eastern. You can also email them at any time.
For just Stock Advisor, you can sign up for a cost of $79/year for your first year. That’s $120 off!
The Motley Fool's services have generally been geared toward those who want to buy stocks in individual companies. While it now has a section for exchange-traded funds (ETFs), the focus has mostly been on individual companies over the years. The Motley Fool's Stock Advisor delivers stock recommendations to your inbox twice a month.
However, TMF stock recommendations are not for people looking to get rich quick. It focuses on high-quality companies it believes will be good investments for many years to come.
Basically, this approach is like investing in a mutual fund, but some people would rather avoid the "losers." They may not have time to do in-depth analysis, though; Fool's services do that for you.
If a stock falls out of favor, it will be removed from the company's recommendations. That has been done many times over the years, but Fool isn't shy about the picks it got wrong. Every one of its stock recommendations are available to subscribers, dating back to the beginning of Stock Advisor.
Many of its services either have upgrades or can be bundled. For example, new members can sign up for both Stock Advisor and Rule Breakers for $199. Overall, The Motley Fool has a lot to offer and is perfect for buy-and-hold investors who don't have time to do their own analysis.
Motley Fool Fees
The Motley Fool has expanded its services over the years, but its most popular ones include:
However, the fees you pay for The Motley Fool depends not only on the service but also on promotions and bundling. For instance, the normal new-member rate for Stock Advisor is $99 for the first year, then $199. However, our 60% off link will make it just $79 for the first year.
Prices vary widely though depending on all the things mentioned above. You can spend as little as $79 for your first year all the way up to Motley Fool One. The latter gives you access to all of their services, but it doesn't come cheap: the price tag is $13,999/year.
Of course, most people don't have that much to spend, and that is perfectly fine. Typically you would buy one or two Fool services and pay the prices you see in the bulleted list above.
Motley Fool Pros
Motley Fool Cons
To find out more about how The Motley Fool works, check out our in-depth review on The Motley Fool.
Zacks Trade is an online broker based in Chicago, Illinois that was first launched in 1976. Zacks comes with relatively low fees (though it does charge fees for stock and ETF trades).
Nevertheless, Zacks uses Interactive Brokers (IBKR) for its clearing services. As a result, it has many of the same features as IBKR, making it a good option for serious traders who look to do their own research. If you are an active trade or a day trader, Zacks is a better choice for you.
Hence, Zacks a good choice for those who wants to do their own in-depth research. However, as detailed below, it does have a high account minimum and charges trade commissions.
Zacks has two desktop trading platforms, its Client Portal in addition to Zacks Trade Pro. Both are available without a subscription, but the Client Portal has a simplified, user-friendly interface, while Zacks Trade Pro is much more robust.
There is also a mobile trading platform called Handy Trader that is both mobile-friendly and tablet-friendly.
One of the standout features of Zacks Trade is that broker-assisted trading is free on the platform. Plus, you can use Zacks Trade in 218 countries on 90 different exchanges.
Zacks also has a subscription-based product called Zacks Premium. It costs $249/year, making it comparable to the price of some of The Motley Fool's products. With a Zacks Premium subscription, you get access to several valuable features such as the Zacks #1 Rank List and Equity Research Reports.
The Zacks #1 Rank List is similar to Stock Advisor recommendations, but the difference is in how they are delivered and maintained. Fool delivers two stock recommendations to your email each month and also send you sell alerts if and when it's necessary. With Zacks, you have to log in to the system to check the #1 rank list.
Zacks doesn't charge any annual fees to use its platform. However, there are some trade fees as outlined in the table above.
Zacks also has premium subscription services, including:
Motley Fool vs. Zacks: Which One is Right For You?
The Motley Fool and Zacks are both quality services, but they tend to have different audiences. The Motley Fool is ideal for those who want stock recommendations delivered monthly. Zacks, on the other hand, is best suited to active traders and day traders who mostly prefer to do their own research.
The result is that we recommend The Motley Fool's services for most investors. We say this simply because most of us don't have time to spend poring over dozens of advanced metrics.
Plus, while Stock Advisor's full price isn't much lower than the price of Zack's Premium, it's still 25% less. And more importantly, our 60% off link makes it $79 for your first year, which makes the barrier to entry much lower.
While you can't go wrong with either, we think Motley Fool is a better value for most people. As you progress more, you may consider trying Zacks Trade Pro, but it isn't necessary for the average investor.