Advertiser DisclosureWe strive for editorial intergrity. We receive compensation from some of the links, products and or services mentioned in this post. Click to read more

Motley Fool Review [2016 to 2023] : Read First, Before Trying Stock Advisor or Rule Breakers!

- TraderHQ Staff

The Motley Fool is a well-known investment company that provides stock recommendations and other financial guidance through its website and various subscription services. The company was founded in 1993 by brothers David and Tom Gardner, and it has become one of the most respected names in the investing world.

One of the Motley Fool's most popular services is Stock Advisor, which provides subscribers with stock picks and market analysis from a team of expert analysts. The service has an impressive track record, with its picks outperforming the market by an average of about 3x since its inception. Another popular Motley Fool service is Rule Breakers, which focuses on identifying disruptive company's that are poised for strong growth.

Stock Advisor is the company’s original service. You get two stock recommendations each month, and access to a searchable archive of past recommendations. The Motley Fool’s analysts research and recommend stocks that they believed will outperform the market over the long-term.

Motley Fool Stock Picks 2016 to Present

Best Picks (2016 to 2024)Return*Annualized Return
E-commerce Company4,216%482%
Computer Graphics Company2,715%60%
Advertising Tech Company1,979%55%
Cloud Database Company1,455%58%
Electric Car Company1,059%59%
Semiconductor Company965%35%
Cloud Software Company832%95%
Cybersecurity Company791%38%
Credit scoring Company695%41%
Freight Forwarding Company679%36%

Of course, past performance is no guarantee of future results, but it does show that the Motley Fool’s stock picks have been quite successful.

In this Motley Fool review, we'll analyze the company's Stock Advisor and Rule Breakers services from 2016-2021 to see how they've performed in terms of stock picking. Results are calculated from recommendation date to 12/31/2021. We'll compare their performance against the S&P 500 to get a complete picture of what investing in Motley Fool stock picks actually looks like.

Motley Fool Review – Stock Advisor vs Rule Breakers

Returns Over-timeStock AdvisorRule BreakersWinner
3 Months8.34%9.48%+13.66% Rule Breakers
6 Months19.72%21.27%+7.89% Rule Breakers
9 Months31.69%33.57%+5.95% Rule Breakers
1 Year42.53%42.48%+.13% Stock Advisor
2 Years100.13%113.27%+13.12% Rule Breakers
3 Years153.44%152.91%+.34% Stock Advisor
4 Years208.65%342.65%+64.22% Rule Breakers
15%+ Returns
at 1 Year
74.23%79.38%+6.94% Rule Breakers
50%+ Returns
at 1 Year
47.42%51.55%+8.7% Rule Breakers
3x Returns
by 4th Yr
8.25%15.46%+87.5% Rule Breakers
10x Returns
by 4th Yr
1.03%5.15%+400% Rule Breakers

Click here to See the Latest Stock Advisor Picks (Feb 20th, 2024)

Who had Better Long-term Performance?

Long-term Performance by 4th YrStock AdvisorRule BreakersWinner
New Recommendations107.21%146.13%+36.31% Rule Breakers
Best Buys68.93%76.88%+11.53% Rule Breakers
Foundational Stocks83.32%191.8%+130.19% Rule Breakers
Blended Average86.49%138.27%+59.88% Rule Breakers

The 3 Types of Stock Recommendations

Both services have the same general structure offering three different types of recommendations each with a different purpose.

The main focus of each service revolves around the new recommendations. Two new recommendations come out monthly and are meant to be the stocks that provide alpha or growth to a portfolio.

The next type are the "Best Buys" or "timely" stocks, which Stock Advisor releases bi-weekly, five per release. Rule Breakers in contrast releases five just once per month. The purpose of these recommendations are for those who are looking to dollar cost average into past recommendations or for those looking to diversify a bit more.

These picks are believed to be the most timely opportunities from past recommendations. This is also a great way for members to see which are the highest conviction stocks on a monthly basis.

The final type are the foundational stocks or what the Fool previously referred to as "starter stocks". These 10 recommendations come out just once per year, in Q1 and meant to provide a strong base of stability as well as growth to new and established portfolios.

These recommendations tend to be stocks that are more established, have good earning power and much less volatility than the new recommendations. They won't provide the high growth that the new recommendations are meant to provide but they help to diversify a portfolio.

Who had the highest yielding best picks?

Best Picks from 2016 to 2021Stock AdvisorRule BreakersWinner
#1 Best Pick:2,015%3,151%+56.43% Rule Breakers
#2 Best Pick:970%2,509%+158.49% Rule Breakers
#3 Best Pick:953%1,852%+94.39% Rule Breakers
#4 Best Pick:942%1,200%+27.43% Rule Breakers
#5 Best Pick:827%1,112%+34.5% Rule Breakers
If $5000 Invested$57,069$98,248+72.16% Rule Breakers

Bundle Offer: Stock Advisor + Rule Breakers + Everlasting Stocks + Real Estate Winners. 1 Year for $319

One of the differences between the two services is the type of stocks that they focus on. Stock Advisor tends to focus on a much broader market, top to bottom, still growth oriented but just not entirely tech. While Rule Breakers is really a high growth, innovation and first to market type of focus which tends to be more tech.

Stock Advisor Performance Review by Sector - 2016 to 2021

SectorReturn% of PicksAnnualized Return
Information Technology160%38%80%
Consumer Discretionary104%16%52%
Communication Services79%11%40%

Rule Breakers Performance Review by Sector - 2016 to 2021

SectorReturn% of Picks+Annualized Return
Real Estate230%2%115%
Information Technology166%31%83%
Communication Services121%16%61%
Consumer Discretionary72%16%36%

Click Here to See the Latest Rule Breakers Picks (Feb 20th, 2024)

Performance vs. The Market (Annualized)

Annualized Returns by 4th YrStock AdvisorRule BreakersWinner
New Recommendations52.16%85.66%+64.22% Rule Breakers
Best Buys17.23%19.22%+11.53% Rule Breakers
Foundational Stocks20.83%47.95%+130.19% Rule Breakers
Blended Average30.08%50.94%+69.39% Rule Breakers
S&P 50016.67%16.67%+.% Rule Breakers

Click here to See the Latest Stock Advisor Picks (Feb 20th, 2024)

New RecommendationsStock AdvisorRule BreakersWinner
1 Year42.53%42.48%+.13% Stock Advisor
2 Years50.07%56.63%+13.12% Rule Breakers
3 Years51.15%50.97%+.34% Stock Advisor
Blended Average47.91%50.03%+4.41% Rule Breakers
Foundational StocksStock AdvisorRule BreakersWinner
1 Year33.51%32.06%+4.51% Stock Advisor
2 Years39.06%30.14%+29.6% Stock Advisor
3 Years34.01%35.81%+5.29% Rule Breakers
Blended Average35.53%32.67%+8.74% Stock Advisor
Best BuysStock AdvisorRule BreakersWinner
1 Year40.31%45.13%+11.97% Rule Breakers
2 Years41.43%42.86%+3.46% Rule Breakers
3 Years32.68%34.82%+6.57% Rule Breakers
Blended Average38.14%40.94%+7.35% Rule Breakers

The Motley Fool is a well-respected investment advice company that has a strong track record of successful stock picking. The company's Stock Advisor and Rule Breakers services have both outperformed the market by a wide margin, making them two of the best investment choices available. If you're looking for solid investment advice, the Motley Fool is definitely worth considering.

Bundle Offer: Stock Advisor + Rule Breakers + Everlasting Stocks + Real Estate Winners. 1 Year for $319

Tips on Getting Started Investing

  1. Exercise due diligence: Prior to allocating capital to any investment, conduct comprehensive research to ensure a thorough understanding of the asset in question.
  2. Consider enlisting a reputable subscription service: If uncertain about where to commence, a service like Motley Fool Stock Advisor can offer valuable guidance. This platform supplies stock selections and analyses from a skilled team of specialists, with a performance history of surpassing market averages.
  3. Embrace diversification: When constructing a stock portfolio, incorporating a range of assets is crucial to mitigating risk.
  4. Develop a strategic investment blueprint: Establishing and adhering to a well-defined plan enables discipline and minimizes the temptation to make hasty decisions that could result in financial setbacks.
  5. Allocate a sensible budget: Determining a budget and remaining within its confines is essential for preventing excessive investment and mitigating unwarranted risk.
  6. Cultivate patience: Patience is a virtue in the world of investing. Attempting to time the market is typically a futile endeavor, so exercise restraint and wait for opportunities to invest in robust companies with strong fundamentals at appealing valuations.

More Stock Market Resources:

Did you know that...

  • While the upside potential of growth stocks is alluring, they can be sensitive to market shifts, economic cycles, and changes in investor sentiment?
  • It's essential to ensure liquidity in the sectors you're considering, especially if they're niche or emerging sectors?
  • Resisting the urge to frequently check portfolio performance can foster a longer-term perspective and reduce anxiety?
  • Understanding the difference between investing and speculating can guide more sustainable wealth-building strategies?
  • 'window dressing' refers to the practice where fund managers buy high-performing stocks towards the end of a quarter to improve the appearance of their portfolio?

Quotes of the Day:

  • "The best way to predict the future is to study the past." - David Dreman
  • "The best way to invest is to learn from your mistakes and not repeat them." - John Paulson
  • "The best way to predict the future is to study the past." - John Neff
  • "The key to successful investing is to be disciplined and stick to your plan." - Julian Robertson
  • "The most important thing in investing is to avoid big losses." - Jeffrey Gundlach

*Disclaimer: Unless noted otherwise all returns are as of Feb 9, 2024. Past performance is no guarantee of future results. Individual investment results may vary. All investing involves risk of loss.

We provide general information, not investment advice. Some of the links on this page are affiliate links in which we receive a commission when a purchase is made.

$89 promotional price for new members only. $110 discount based on current list price of Stock Advisor of $199/year. Membership will renew annually at the then current list price.

$99 promotional price for new Rule Breakers members. $200 discount based on current list price for Rule Breakers of $299. Membership will renew annually at the then current list price.