Motley Fool Stock Advisor Review – 2017 Stock Picking Performance Review
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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 (see our review) 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 recommendation types to get a complete picture of 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…
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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.
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Best Buys: These recommendations are released bi-weekly and they feature 10 timely recommendations which are believed to be the best stocks from all active recommendations current and past.
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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 base 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-depth review) in 2017.
How did the 2017 Stock Advisor Picks Perform Long-term?
| 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.
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The Best Stock Advisor Picks of 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. That’s 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 (May 25th, 2024)
How did Stock Advisor Perform vs Rule Breakers?
While Stock Advisor performance was great, Rule Breakers (in-depth review) out-performed in many categories. Rule Breakers had…
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344% higher 3-month returns
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105% higher 2-year returns
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57% more 3x returns
Bundle Offer: Stock Advisor + Rule Breakers + Everlasting Stocks + Real Estate Winners (see our review). 1 Year for $319
The Worst Stock Advisor Picks from 2017
| 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
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Best Stock Advisor Pick from 2017
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Best Stock Advisor Pick from 2017
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Best Stock Advisor Pick from 2017
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Best Stock Advisor Pick from 2017
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Best Stock Advisor Pick from 2017
How did the 2017 Stock Advisor Picks Perform in the Short-term?
| 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 (May 25th, 2024)
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.
| 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% |
New RecommendationsStock AdvisorS&P 500Beat Market by1 Year34%20%71%2 Years24%6%324%3 Years39%14%172%Blended Average32%13%143%
Foundational StocksStock AdvisorS&P 500Beat Market by1 Year50%20%150%2 Years27%6%372%3 Years40%14%183%Blended Average39%13%193%
Best BuysStock AdvisorS&P 500Beat Market by1 Year30%20%51%2 Years22%6%278%3 Years23%14%64%Blended Average25%13%88%
Click here to See the Latest Stock Advisor Picks (May 25th, 2024)
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 continues 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 believe 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.
Bundle Offer: Stock Advisor + Rule Breakers + Everlasting Stocks + Real Estate Winners. 1 Year for $319
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Did you know that…
Companies with high levels of insider ownership can signal that management has a vested interest in the company’s success? Asset allocation is the process of dividing an investment portfolio among various asset classes like stocks, bonds, and cash, influencing both risk and potential returns? Defensive sectors like healthcare and utilities provide more stability during economic downturns, compared to cyclical stocks such as technology? The size effect suggests that small
Related Motley Fool Resources:
- •Read our comprehensive Motley Fool review.
- •Explore our picks for the Best Investment Subscriptions.
- •Review our detailed Motley Fool Stock Advisor Review.
- •Take advantage of our Motley Fool discounts.
🧠 Thinking Deeper
- ☑️ Consider low-cost index funds if you don't have the time or inclination for individual stock selection.
- ☑️ Be willing to be contrarian. The most profitable investments are often the least comfortable.
- ☑️ Understand that the market oscillates between extremes. Neither optimism nor pessimism lasts forever.
- ☑️ Think in terms of building lasting wealth, not just making quick profits.
📚 Wealthy Wisdom
- ✨ The stock market is designed to transfer money from the active to the patient. - Warren Buffett
- ✔️ The key to making money in stocks is not to get scared out of them. - Peter Lynch
- 🌟 You get recessions, you have stock market declines. If you don't understand that's going to happen, then you're not ready, you won't do well in the markets. - Peter Lynch
- 🚀 Everyone has the brainpower to follow the stock market. If you made it through fifth-grade math, you can do it. - Peter Lynch
📘 Table of Contents
- • How did the 2017 Stock Advisor Picks Perform Long-term?
- • The Best Stock Advisor Picks of 2017
- • How did Stock Advisor Perform vs Rule Breakers?
- • The Worst Stock Advisor Picks from 2017
- • 5 Best Picks by the Charts
- • How did the 2017 Stock Advisor Picks Perform in the Short-term?
- • Stock Advisor 2017 Win Rates
- • Stock Advisor Performance Review by Sector - 2017
- • Performance vs. The Market (Annualized)
- • Conclusion
- • More Stock Market Resources: