Motley fool Stock Market Is it good or bad

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Saurabh Guptahttp://karekaise.in
नई तकनीक का आविष्कार, गैजेट्स, उपभोक्ता प्रौद्योगिकी और सॉफ्टवेयर के लिए आपका स्रोत. कंप्यूटर, स्मार्टफोन, इलेक्ट्रॉनिक गैजेट्स और इंटरनेट सामग्री पर नवीनतम रुझानों के लिए हमारी वेबसाइट देखें!

Alright, everybody, in this article I’m going to give you an actual review of the Motley Fool, I’m going to tell you the  Motley fool Stock Market Is it good or bad, Motley Fool stock picks have performed  recently and I’m going to give you the real pros  and cons of the Motley Fool. There’s real talk in this article, I actually purchased Motley Fool’s  flagship program the Motley Fool Stock Advisor subscription so I can review it for you, yes, this  is an actual review, and I say this is an actual review because unfortunately right now when you  search “Motley Fool Review” what you often see is  websites basically just shilling the Motley Fool  so they can collect their affiliate commission, in fact one of the comments on one of the more  popular Motley Fool review videos basically says as much.

But in this article I’m  actually going to give an honest review of the Motley Fool’s stock picking service, real  talk, that people can know the real pros  and cons of the Motley Fool and not just watch a  sales pitch when they try to do their research  on this service . Alright, so before  I get into the pros and cons of the Motley Fool  and my personal experience with the Motley Fool,  let’s give a little background and history.

Inspiration for the  Motley Fool’s name


So the   Motley Fool was founded in 1993 by brothers David  and Tom Gardner. Why’d they name themselves the  Motley  Fool? It’s because in Elizabethan dramas  such as those written by William Shakespeare,  there was often a character who was the fool or  the court jester, and in these dramas the fool,  though he played the part of a ridiculous person,  was often the wisest character in the  play and he could actually speak his mind,  because he plays the role of the joker he  can actually speak truth about the king or otherwise in his jesty fashion, truth  that if said by others would end up with  other people losing their head. So in Elizabethan  dramas it’s often the fool, the court jester,  who serves as the primary truthteller for the audience. For example in King Lear, the unnamed  fool is always calling out King Lear on his dumb  decisions. He’s a truthteller, and he’s an amusing  truthteller, so that’s the inspiration for the  Motley Fool’s name.

Also read: how to analyze stocks.

Also read: how to manage portfolio in 2022.

What is motley fool.


The Motley Fool  claims to  educate and amuse and enrich individuals in the  search of truth. And the main way they try to do  this is by sharing stock picks. If you go to  fool.com, you’ll see all their recent blog  posts and content basically full of stock picks.  For example, here’s an article, “Forget Alibaba,  these 3 Chinese tech stocks are better buys.” So  how all their free content works is there’s an  elementary-level analysis and then at the bottom  they pitch you on a freebie in an attempt to get  you to give them your email address, and of course  after you give them your email address you’re on  their mailing list so they can put you in an email  sales funnel for the Motley Fool Stock Advisor,  their flagship stock picking program. So that’s  their basic business model.

  How are their actual stock  picks? Are they good or are they bad?


Well,  on their website, they claim that their stock  picks have beaten the S&P 500 by leaps and bounds,  that their Stock Advisor service is up five  hundred plus percent while that raggedy old S&P 500 is only up 100%. Problem is, though,  is that it’s pretty much impossible to verify  this one way or the other, and other than a tiny  graph here, I don’t see any proof of this claim,  so I don’t really put much stock in this, no  pun intended. But the proof, or lack of proof,  is in the pudding, so I decided to purchase  a subscription to Motley Fool Stock Advisor  so I could test it out and tell you what I think  about it, and that’s what I’m going to do.

 What  do you get with the Motley Fool Stock Advisor?


Well the main thing you get is stock picks,  they have their “Stocks to Buy Today,” about ten  or eleven so stocks that the Motley Fool thinks  you should buy today, I’m not going to show them  here because that is of course the Motley Fool’s  proprietary information, I will however later  in this video tell you how they performed.

Now,  before we get into the stock picks themselves  and their performance, before I get into those  numbers for you, I just want to talk about the  mentality that the Motley Fool promotes because  more than anything, this is what I have beef  with.

The mentality that the Motley Fool, and  any stock picker, frankly, whether it’s CNBC and  Jim Cramer or all these other financial rackets,  in my opinion the mentality they promote is one of  addiction and in this case stock market addiction.

Now, I’m not a medical professional, I’m not  using the word “addiction” in a clinical sense,  by stock market addiction I just mean, when I  say that, when I say that somebody is addicted  to the stock market I mean that they check  the stock market more often than they should  and they’re always looking for that next  stock pick that’s going to make them rich,  and their mood and their day is affected by how  their stocks performed today because they’re  constantly checking them.

That’s a miserable  way to live. Now, don’t get me wrong here. The  Motley Fool would never say that’s what you  should be doing. The Motley Fool says that  their investment philosophy prioritizes buying and  holding quality stocks for long periods of time,  if you look on their investing philosophy page,  it’s all very sound, invest for the long-term,  hold for the long-term, don’t worry about  short-term fluctuations, all the good stuff, right.

But in my opinion when  the Motley Fool sends me, after, mind you, I have  purchased their flagship service, the Motley Fool  Stock Advisor, when they send me daily emails  talking about new stock picks constantly, their  number one stock for the Sun Belt migration trend,  my free Real Estate Trailblazers stock  pick, a relatively unknown stock that  was three hundred and fifteen x growth potential,  stocks to invest in before the market opens, the  next Amazon, blah, blah, blah, more stock picks  than you know what to do with, this seems to me,  and feel free to disagree, but it really seems to  me that they’re promoting this “next big thing,  next hot stock pick” investing mentality. That’s  just my opinion.

how the Motley Fool Stock Advisor picks have  performed in the approximately three months 


Since I’ve been a subscriber compared to one of  my favorite index fund ETFs, the Vanguard Total  Stock Market Index Fund ETF, ticker symbol VTI,  which seeks to track the performance of the U.S.

Stock market as a whole, so in the analysis  I’m going to share with you shortly I’m going  to show you the Motley Fool picks performed vs.  how your money would have grown if you had just  put the same amount as put in Motley Fool into  VTI. And look, I want to emphasize that this is  just three months’ worth of performance, but when  you’re investing, you invest for the long-term,  not just for three months, I believe  that, that is Motley Fool’s philosophy, so one criticism of the analysis I’m going to  share with you here, and it’s a valid criticism,  is that the Motley Fool makes stock  picks for the next X number of years  and maybe it’s not fair to just compare three  months’ worth of performance to an index fund,  but my counters to that is

A) this is still data,  no, it’s not long-term data, but it’s still data,  and we might be able to make conclusion from it

B) this is the best I have because I’ve only  been a Motley Fool subscriber for three months.

So without further ado, here’s the data. Obviously  some columns are hidden here because I don’t want  to share with you the Motley Fool’s proprietary  information, so I’m not showing you the ticker  symbols obviously, I’m not showing you the share  price of the stocks, or any of that, all that  information is hidden,  which you cannot see here, but basically what I  did is assumed that in this hypothetical example:

I bought a thousand dollars’ worth of each Motley  Fool pick the day I was informed of that pick,  by the way to keep things consistent  here between one stock and another, all prices I used were based on the  closing price of the stock for the day purchased. And then I calculated what the value  of that investment would be, including dividends,  because dividends reduce the price of the stock,  but I want to capture the dividends too, the total return, and I calculated what the value of that  investment (including dividends, if paid) would  be on June 11, which is when I ran these numbers.

So you can see that for Stock 1, for example,  in this example I would have invested a thousand  dollars on March 18, and on June 11, the value of the investment would have been one thousand,  one hundred and sixteen dollars. So I ran these  numbers for all the stock picks that Motley Fool  sent me on Thursday through the Stock Advisor,  it’s on Thursdays that they announce picks  through the standard Stock Advisor program,  one week they didn’t do that, but instead they  sent a list of what they called “Starter Stocks,”  so that’s included here as well,  anyway I basically tracked these stocks  and basically if I had invested a thousand dollars  into all these stocks on the day I got each pick,  I would have invested in thirty-four stocks so my  basis would be thirty-four thousand dollars, and  the value of these stocks on June 11 would have  been thirty-four thousand, three hundred and five  dollars and forty-seven cents, so an increase of  three hundred and five dollars and forty-seven  cents.

So at least they went up in value in the  aggregate. Now, what if I had simply, invested the  same amount of money on the same days into VTI,  the Vanguard Total Stock Market Index Fund ETF,  how much would I have? So on March 18 in the  first example, I would have purchased eleven  Motley Fool stocks, putting a thousand dollars  into each one, so in the ETF example, I assume  that I purchased eleven thousand dollars worth  of VTI on March 18. So if I would have done this,  I would have invested the same thirty-four  thousand dollars into the market in this  three-month period, how much would I have  had on June 11, the day I ran these numbers,  I would have had thirty-five thousand, seven  hundred and two dollars and sixty-three cents,  an increase of one thousand, seven hundred  and two dollars and sixty-three cents.

https://miro.medium.com/max/1400/1*M6JFZiqSzdQEUtCCASsRrA.png

Compare that to the Motley Fool picks, almost  fourteen hundred dollars more by just investing in  the index fund. So what am I saying? Am I saying  that the Motley Fool’s stock picks are always bad  picks, they’re dogs, not necessarily, again, this  was only three months’ worth of data, but with  the limited data I have, I’m not convinced that I  should use Motley Fool to inform my investing, I’m  sticking mostly to index funds for now folks, as  you know, as I’ve said on the channel, I do play  with individual stocks, cryptos, and things like  that with five to ten percent of my portfolio,  but the majority of it is in index funds. Alright,

The real pros  and cons of the Motley Fool


Pros:

  1.  While in my opinion  its marketing doesn’t always reflect this,  I believe that the Motley Fool’s stated investing  principles are sound, investing for the long-term,  not freaking out when the market goes  down, staying course, all that good stuff,  so I would say pro number one is sound  overall investment philosophy.
  2.   The Motley Fool does do a decent job of making  basic investing concepts easy to understand  and oriented toward the layman. That being said,  and this is kind of my segway into the cons here,  the Motley Fool can sometimes be a little  too simplistic in my opinion.

 

Cons:

  1.  like I said, this is just my opinion,  but sometimes I found the “analysis” you get with  the stock picks in Motley Fool stock advisor to  pretty light. I can’t show you a specific example  because that would be showing you the Motley  Fool’s proprietary information, but oftentimes  the commentary on a particular stock when the  Motley Fool releases a new pick, a new best buy,  the analysis is basically something like, “OK,  here’s the stock, here’s what the business does,  here’s a few sentences on its unique position in  the marketplace, here’s a few numbers we picked  from the latest financials the company released,  and here’s the basic chart and stock quote  information you could get from anywhere.” So in my  opinion the analysis can frankly be a bit light.
  2.  In my opinion, the Stock  Advisor picks are really heavy in tech,  so naturally with tech, oftentimes you have some  real winners but then also some real dogs whose  valuations were just unjustifiably  sky high and the stock tanks,  so if you do base at least part of your portfolio  on the Motley Fool’s Stock Advisor stock picks,  be prepared to deal with volatility.
  3.  The constant upselling,  every day or almost every day, email from the  Motley Fool trying to get me to purchase some  additional service or subscription so I can get  even more stock picks, look, I know this is their business, but like I said earlier in this review,  that kind of rubs me the wrong way, that’s not how  I want to invest, constantly chasing the next  great stock pick.
  4.  At least in my experience, which is limited  as I said, the Motley Fool’s stock picks  haven’t beaten the market. Alright, folks, that is  my honest Motley Fool review.

WHAT DID YOU LEARN TODAY


I hope you have liked my article on How to Analyze best stocks in Stock Market. It has always been my endeavor to provide complete information about the future of stock market to the readers, so that they do not have to search any other sites or internet in the context of that article.

This will also save their time and they will also get all the information in one place. If you have any doubts about this article or you want that there should be some improvement in it, then you can write comments below for this. this is only for educational purpose.

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