Most investors are familiar with the Motley Fool, a stock picking service that has been around since 1993 and is hard to miss if you are researching common topics and questions about investing in stocks. It has a good track record and affordable price point, making it very attractive to investors who are looking for some expert guidance to get them started without breaking the bank.
A lot of the discussion about the Motley Fool is about their Stock Advisor service, so many are surprised to learn that it actually has more than one offering – in addition to Stock Advisor, there is also Motley Fool Rule Breakers. If you’re hearing this for the first time, starting with reading a Motley Fool Rule Breakers review will give you a good overview.
Motley Fool Stock Advisor vs Rule Breakers
The main difference between the two Motley Fool products is in the type of stocks that they recommend buying. Stock Advisor is very much a conventional stock picking service, focusing on those with established track records and some degree of predictability or at least stability in their share price. It’s cliché to say, but Rule Breakers “breaks the rules” in a sense, recommending up and coming stocks that are a little further outside the box and a bit trickier to predict the trajectory of.
Generally speaking, Rule Breakers’ strategy of targeting high growth stocks will skew its picks more towards the tech sector. Past examples include Facebook and Tesla, and it’s not hard to imagine how those worked out for subscribers who were wise enough to follow their buy recommendation. However a heavy bias towards tech stocks does require that investors be more mindful of ensuring they are suitably diversifying their portfolio, and it means they need the stomach for extreme swings in valuation and share price.
That said, the services have as many similarities as they do differences. Both are based around a simple concept – 24 picks per year, or about 12 per month. If you are one of the investors who is seriously considering subscribing to both, it’s helpful to know that it is very rare for them to each recommend the same stock, meaning you will get the diversity of recommendations that you are paying for.
Motley Fool – For Wise Investors?
It’s easy to joke about their name, but the fact is you would need to be a fool to not give the Motley Fool serious consideration. They have been picking winning stocks for many years. Members have access to several core pieces of information, including their list of recommended stocks to buy today (which gets updated in real time as more picks are released) and a suggested list of starter stocks to form the foundation of a durable and successful portfolio.
Their results speak for themselves – $10,000 invested 18 years ago across Motley Fool picks would now be worth about $250,000 based on a time-weighted return, with many winners producing returns of more than 1,000% and even 10,000% along the way. Just in the past decade, Motley Fool has had returns greater than 20% in 4 years and returns between 12-19% in 4 other years.
Beyond the stellar results, Motley Fool also comes at a fairly reasonable cost – if you buy a year’s subscription up front rather than going month-to-month, it’ll run you $199. Right now there’s a great deal offering introductory pricing of $89 for the first year, big savings on a product that already represents strong value. Their 30-day money back guarantee is another safeguard that will let you feel confident that the Fool is the right tool for you.
Rule Breakers – Will it Help You?
Motley Fool Rule Breakers has an undeniable track record of finding huge winners early on, bringing outsized returns to investors who were fortunate enough to receive those picks and act on them. That said, the nature of Rule Breakers’ picks means that there is also higher risk, which is amplified when it comes to picking individual stocks. It’s safe to say that you’ll want some background and level of comfort when it comes to making decisions around individual stocks before jumping into Rule Breakers. It’s also a good idea to familiarize yourself with all the features of Rule Breakers before taking the plunge.
Another thing to keep in mind is that Motley Fool’s picks are geared towards those with a buy-and-hold approach to investing. They suggest being prepared to hold positions for five years in order to ride out periods of volatility and maximize returns. It is important to be aware of this if you’re an active trader looking to deploy a day trading or swing trading strategy. But don’t lose focus on the big picture here: Motley Fool is a tremendous resource that frequently receives strong recommendations from users and analysts alike.