Motley Fool Stock Advisor Review – 2017 Stock Picking Performance Review
How did the 2017 Motley Fool Stock Advisor Picks Perform?
It's time to look back at the 2017 performance of the Motley Fool Stock Advisor service and analyze all the stock picks measuring short and long-term performance 4 years later.
For this review we'll analyze the performance of recommendations including the worst performers. We'll break down the performance by the 3 recomendation types to get a complete picture on the Motley Fool Stock Advisor way of investing so you can better decide if the service is right for you.
For those unfamiliar Stock Advisor has three types of recommendations which are...
- New Recommendations: These are high growth recommendations which they release two of them monthly. On occasion they are re-recommendations of a past pick when their conviction level is extremely high.
- Best Buys: These recommendations are released bi-weekly and they feature 10 timely recommendations which are believedd to be the best stocks from all active recommendations current and past.
- Foundational Stocks: Sometimes called "Starter" stocks, these 10 stocks are released at the beginning of the year and are designed to provide maturity, stability and growth to new and established portfolios.
In general the Motley Fool recommends a portfolio construction of at least 25 stocks to have adequate diversity and the foundational stocks are meant to provide a based on which you begin purchasing new recommendations, building up over-time to a portfolio of at least 25 holdings.
Probability of Positive Returns
The Motley Fool analyzed Stock Advisor performance from March 31, 2002 – November 19, 2021, using an average portfolio from an average month during that time period to help determine the optimal number of holdings and holding period.
They found that the optimal number of stocks to hold is 25 and the optimal minimum holding period is 5 years which produced a 98.4% likelihood of positive returns with an average return of 89.6%.
So without further ado let's dive in and look at the performance of Stock Advisor in 2017.
How did the 2017 Stock Advisor Picks Perform Long-term?
| Long-term Performance | 1 Year | 2 Years | 3 Years | As of (3/21/22) |
| New Recommendations | 34% | 48% | 117% | 204% |
| Best Buys | 30% | 43% | 70% | 132% |
| Foundational Stocks | 50% | 54% | 121% | 155% |
| Blended Average | 38% | 48% | 103% | 164% |
- New Recommendations produced a 204% cumulative return to date.
- Best Buys produced a 132% cumulative return to date.
- Foundational Stocks produced a 155% cumulative return to date.
- Blended Average produced a 164% cumulative return to date.
The Best Stock Advisor Picks of from 2017
Here are the 5 best Motley Fool Stock Advisor stock recommendations from 2017.
| Best Picks from 2017 | 1 Year | 2 Years | 3 Years | As of (3/21/22) |
| #1 Best Pick: | 96% | 198% | 882% | 953% |
| #2 Best Pick: | 126% | 44% | 143% | 942% |
| #3 Best Pick: | 76% | 71% | 175% | 469% |
| #4 Best Pick: | 65% | 221% | 346% | 407% |
| #5 Best Pick: | -5% | 39% | 43% | 245% |
| If $5000 Invested | $3,569 | $5,732 | $15,888 | $30,162 |
The best Stock Advisor pick from 2017 produced a 953% return by the 4th year, making a $1000 investment worth $10,528. A $1000 investment in each of these picks would have returned you $30,162 by the fourth year.
Thats the power of compounding returns.
That 10x return on one stock would cancel out 10 other equal weighted investments that go to zero. That is the power of asymmetric risk.
You can only lose 1x the money you invested, while you can gain 5x,10x,100x or more. That's asymmetric returns and the primary draw of stock picking and the value of services like the Motley Fool offers.
Click here to See the Latest Stock Advisor Picks (Dec 8th, 2023)
How did Stock Advisor Perform vs Rule Breakers?
While Stock Advisor performance was great, Rule Breakers out-performed in many categories.
- Rule Breakers had...
- 344% higher 3 month returns
- 105% higher 2 year returns
- 57% more 3x returns
The Worst Stock Advisor Picks from 2017
Here are the 5 worst performing Motley Fool Stock Advisor recommendations from 2017 to date.
| Worst Picks of 2017 | As of (3/21/22) | |||
| #1 Worst Pick: | -17% | 1% | -10% | -34% |
| #2 Worst Pick: | 1% | -17% | -13% | -20% |
| #3 Worst Pick: | 25% | 1% | -14% | -1% |
| #4 Worst Pick: | 51% | 60% | 15% | 22% |
| #5 Worst Pick: | 6% | 18% | 37% | 29% |
| If $5000 Invested | $5,660 | $5,648 | $5,145 | $4,959 |
The worst Stock Advisor pick from 2017 was down -34% by Mar 21, 2022 making a $1000 investment worth just $662.
A $1000 investment in each of these picks ($5000 total) is worth $4,959 as of Mar 21, 2022.
Based on equal weight investing the 5 best picks returned 617x more money than the losses from the 5 worst picks in 2017.
5 Best Picks by the Charts
#1 Best Stock Advisor Pick from 2017
#2 Best Stock Advisor Pick from 2017
#3 Best Stock Advisor Pick from 2017
#4 Best Stock Advisor Pick from 2017
#5 Best Stock Advisor Pick from 2017
How did the 2017 Stock Advisor Picks Perform in the Short-term?
| Short-term Performance | 3 Months | 6 Months | 9 Months | 1 Year |
| New Recommendations | 4% | 19% | 28% | 34% |
| Best Buys | 7% | 13% | 26% | 30% |
| Foundational Stocks | 15% | 25% | 33% | 50% |
| Blended Average | 9% | 19% | 29% | 38% |
- New Recommendations produced an average return of 4% at 3 months and 28% at 9 months.
- Best Buys produced an average return of 7% at 3 months and 26% at 9 months.
- Foundational Stocks produced an average return of 15% at 3 months and 33% at 9 months.
Click here to See the Latest Stock Advisor Picks (Dec 8th, 2023)
Stock Advisor 2017 Win Rates
Now let's look at win rates and see what percentage of stocks produced a 15%+ and 50%+ return in the first year.
Then let's look at the unicorns and see how many 3x and 10x stock picks so far to date.
| Win Rates | 15%+ Returns at 1 Year | 50%+ Returns at 1 Year | 3x Returns | 10x Returns |
| New Recommendations | 55% | 36% | 18% | |
| Best Buys | 66% | 35% | 12% | |
| Foundational Stocks | 100% | 60% | 1% |
How did the 2017 Stock Advisor Picks Perform in the Short-term?
- New Recommendations had 55% of picks with 15%+ returns in the first year and 36% with 50%+ returns. So far to date 18% have had 300%+ returns, 0.0% have had 1000%+ and one pick with an amazing 953% return.
- Best Buys had 66% of picks with 15%+ returns and 35% with 50% returns at one year.
- Foundational Stocks had 100% of picks with 15%+ returns and 60% with 50%+ returns at one year.
Stock Advisor Performance Review by Sector - 2017
| Sector | Return | % of Picks | Annualized Return |
| Information Technology | 98% | 27% | 49% |
| Healthcare | 48% | 9% | 24% |
| Industrials | 34% | 18% | 17% |
| Consumer Discretionary | 25% | 36% | 12% |
| Financials | 22% | 9% | 11% |
The top performing sectors were information technology, healthcare and industrials with information technology yielding the highest return of 98%
. The average sector weight was 20% with the largest sector accounting for 36% of the picks.
Performance vs. The Market (Annualized)
| Annualized Returns | 1 Year | 2 Years | 3 Years | 4 Years |
| New Recommendations | 34% | 24% | 39% | 44% |
| Best Buys | 30% | 22% | 23% | 33% |
| Foundational Stocks | 50% | 27% | 40% | 39% |
| Blended Average | 38% | 24% | 34% | 39% |
| S&P 500 | 20% | 6% | 14% | 16% |
| New Recommendations | Stock Advisor | S&P 500 | Beat Market by |
| 1 Year | 34% | 20% | 71% |
| 2 Years | 24% | 6% | 324% |
| 3 Years | 39% | 14% | 172% |
| Blended Average | 32% | 13% | 143% |
| Foundational Stocks | Stock Advisor | S&P 500 | Beat Market by |
| 1 Year | 50% | 20% | 150% |
| 2 Years | 27% | 6% | 372% |
| 3 Years | 40% | 14% | 183% |
| Blended Average | 39% | 13% | 193% |
| Best Buys | Stock Advisor | S&P 500 | Beat Market by |
| 1 Year | 30% | 20% | 51% |
| 2 Years | 22% | 6% | 278% |
| 3 Years | 23% | 14% | 64% |
| Blended Average | 25% | 13% | 88% |
Click here to See the Latest Stock Advisor Picks (Dec 8th, 2023)
Conclusion
The stock picks from Motley Fool Stock Advisor in 2017 strongly outperformed the market in nearly every category. The annualized returns on the new recommendations beat the market by 172% in the 3rd year and the Best Buys beat the market by 64% in the same period.
Stock Advisor continue to prove itself to be an invaluable source for oriented growth investing recommendations. And each year they continue to add exponentially more value through all the additional resources like daily market briefings, webcasts, market research and more frequent updates and coverage on new and past recommendations.
For serious investors just getting started or those with years and decades of experience we believed Stock Advisor is a great investing companion well worth the $99/year (for new members).
Additionally the Motley Fool has a similar service called Rule Breakers which in many categories has out-performed Stock Advisor. You can see our yearly reviews of that service here.
We actually advise people to try both services together as they are very complementary to each other and provide 2x the stock recommendations and they come with a 30 day membership back fee guarantee.
More Stock Market Resources:
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- Motley Fool Discounts
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- Motley Fool Rule Breakers
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Did you know that...
- Creating "what if" rules in advance (e.g., "if x drops by y%, i will do z.") can provide a clear action plan during market turbulence?
- Growth stock investing, combined with an understanding of asymmetric risk, requires both a strong stomach for volatility and a conviction in one's research and analysis?
- Market capitalization, calculated as the stock price times the total number of outstanding shares, gives an indication of a company's total value in the market?
- Angel investors are individuals who provide capital to startups in exchange for ownership equity or convertible debt?
- Framing, or the way information is presented, can drastically influence an investor's perception and subsequent decision-making?
Quotes of the Day:
- "The stock market is a voting machine rather than a weighing machine." - Philip Fisher
- "Investing is not about predicting the future, it's about understanding the present." - Bruce Berkowitz
- "The best investments are usually the ones that are hardest to make." - Bruce Berkowitz
- "The stock market is a voting machine in the short term and a weighing machine in the long term." - Donald Yacktman
- "The stock market is a no-called-strike game. You don't have to swing at everything - you can wait for your pitch." - Edward Owens
*Disclaimer: Unless noted otherwise all returns are as of Dec 8, 2023. 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.