Author Topic: Anyone recommend a Motley fool subscription? (Read 171427 times)

decessus

  • 5 O'Clock Shadow
  • *
  • Posts: 44
Anyone recommend a Motley fool subscription?
« on: May 31, 2015, 11:34:33 PM »
What do folks think of a subscription to Motley fool? I was intrigued by their $129 for 2 years? pitch, but I wonder:

1) Are their stock picks any good?
2) Is it a waste of $ and better to just focus on index fund investing, especially if you're into early retirement.

surfhb

  • Guest
Re: Anyone recommend a Motley fool subscription?
« Reply #1 on: June 01, 2015, 02:00:28 AM »
It's be proven that nobody knows what the market will do long term. Why would you take advice from someone who knows nothing? ;)

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #2 on: June 01, 2015, 05:46:56 AM »
I have 3 fool subscriptions -- Pro, which includes Options, Stock advisor, and Rule breakers. I enjoy them and most of my available money is in stocks. 401k and other things are limited.

My approach is to have control -- I want to learn and develop skills and have advisors. Pro is my home service, it is conservative and the people that run it are great.

Stock advisor is an idea service. They are going to throw many ideas at you and you need to discern what companies meet your goals.

I also listen to Jim Cramers podcast, I read Joshua Kennons blog and I enjoy Sauls investing discussions free board at the Fool.

A SA subscription is cheap. The question is whether you are into individual stocks. There are many very successful people at the fool community, but some people will go at it like gambling and become very dissatisfied.

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #3 on: June 01, 2015, 05:52:32 AM »
Some of their picks are great and others not so much. The market is fascinating and I love learning about businesses. You also have to develop your investing goals and style. It takes time to figure out what you like best and what works for you. Indexes are set and forget. Stocks need to be monitored, quarterly. Fool will help with earnings reviews.

martin

  • 5 O'Clock Shadow
  • *
  • Posts: 15
Re: Anyone recommend a Motley fool subscription?
« Reply #4 on: June 01, 2015, 06:46:47 AM »
I don't think they pay their analysts very well - at least on the Canadian site.
They were touting Bombardier as their secret super stock pick of 2015, because the Paris air show will be a big break for their new 737 competitor.
This was published a week after Bombardier admitted the plane wouldn't be ready to go to Paris.

GuitarStv

  • Walrus Stache
  • *******
  • Posts: 9402
  • Location: Toronto, Ontario, Canada
Re: Anyone recommend a Motley fool subscription?
« Reply #5 on: June 01, 2015, 06:55:53 AM »
It is a waste of money. Don't ask me though, let's see what Motley Fool has to say about index investing:

It's be proven that nobody knows what the market will do long term. Why would you take advice from someone who knows nothing? ;)

It's worse than just taking advice, you're paying for the advice from someone who knows nothing.

forummm

  • Walrus Stache
  • *******
  • Posts: 7358
  • Senior Mustachian
Re: Anyone recommend a Motley fool subscription?
« Reply #6 on: June 01, 2015, 07:28:06 AM »
There's a great section in an old Frontline documentary from about 1998 about how Fools lost an insane amount of money betting on Internet stocks that had been overhyped on their service.

I don't visit their site much, but occasionally click through on articles. Their ads and other things that try to entice you to sign up for their services look like total clickbait scams to me--like those "one weird trick" ads.

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #7 on: June 01, 2015, 07:56:25 AM »
Imo the free section mostly sucks and the ads are pushy. And on the paid side you still need to use your brain and accept the risk and responsibility for your money.



Casserole55

  • 5 O'Clock Shadow
  • *
  • Posts: 15
Re: Anyone recommend a Motley fool subscription?
« Reply #8 on: June 01, 2015, 08:00:32 AM »
I subscribed to Motley Fool back in 2004 - 2006. I bought maybe 15 stocks. Two did really well. One has appreciated 10 times. This one stock made the whole gambit successful. I recently did a 30 day free trial on MF's Hidden Gems (small cap stocks) to see what their recommendations were for the stocks that I still hold, and to see if I wanted to get back into individual investing. I discovered that after I cancelled my subscription, they issued a sell recommendation for that one stock that went up 10 times. Most of the gain occurred after their sell recommendation. They broke their own rule of hold, hold, hold. Even so, I may take a 30 day free trial of the Stock Advisor.

mizzourah2006

  • Bristles
  • ***
  • Posts: 316
  • Location: NWA
Re: Anyone recommend a Motley fool subscription?
« Reply #9 on: June 01, 2015, 08:42:50 AM »
Listen to their podcasts for free and see if you like the way they look at the market. They also mention a lot of their recommendations on their podcasts.

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #10 on: June 01, 2015, 08:48:38 AM »
Some of the winners I've got from the Fool: ambarella, skyworks, Apple, papa johns.... Most of my stocks are doing well. I also keep an eye on them.

Bicycle_B

  • Handlebar Stache
  • *****
  • Posts: 1257
  • Mustachian-ish in Live Music Capital of the World
Re: Anyone recommend a Motley fool subscription?
« Reply #11 on: June 01, 2015, 08:53:46 AM »
To benefit by picking individual stocks, you will be investing your time. Remember that your time could also be spent earning money, so there is an opportunity cost.

If you are going to spend your time on stock picking (ineffective for most people who are not Warrren Buffett...Buffet recommends indexing...), consider the strategy of using it in a cost-efficient way. For that, try following suggestion of the poster before last!

Bonus technique: network with other individual stock pickers, find one with a Fool subscription, trade recommends with them for free.

Last comment on individual stock picking: To do it successfully, you have to go against the crowd. Motley Fool is part of the crowd. You'd be paying money to stand on sinking ground, in a sense.

I've done other deals where I paid for aggressively marketed "expertise." Rarely worthwhile in my experience. You'd be better off borrowing investment books from a library, and applying the principles yourself. You'll develop your skills faster too.

Rubic

  • Pencil Stache
  • ****
  • Posts: 853
Re: Anyone recommend a Motley fool subscription?
« Reply #12 on: June 01, 2015, 09:34:43 AM »
I'm a big fan of the Motley Fool forums and think many of the articles on their website are well-researched (though content quality varies widely). Around 16 years ago I even stopped by their offices in Old Town Alexandria to briefly chat with David and Tom Gardner.

However, I wouldn't ever consider acting on TMF's financial advice (except to invest in index funds), much less pay for the service. Worse, if you subscribe to their service you're more likely to get caught up in the day-to-day market fluctuations -- which is exactly what you're trying to avoid with investing.

I used to subscribe to the (now moribund) Outstanding Investor's Digest. It's main value was to convince me how much effort successful money managers had to work to generate above average market returns.

NorCal

  • Pencil Stache
  • ****
  • Posts: 530
Re: Anyone recommend a Motley fool subscription?
« Reply #13 on: June 01, 2015, 09:46:07 AM »
I routinely read the MF articles about the mega-corp I was previously employed by.

Bottom line, they have some people who are good at writing, but not at understanding the companies they covered. The writers didn't understand the actual economics of the business, the nature of competition, or drivers of growth.

To be fair, I worked in an industry that thrived on obscurity of pricing and deals. But that doesn't make the analysis any better.

hodedofome

  • Handlebar Stache
  • *****
  • Posts: 1110
  • Location: Texas
Re: Anyone recommend a Motley fool subscription?
« Reply #14 on: June 01, 2015, 10:34:54 AM »
If you view it as a tuition to learn a few things, then it may be worth it. If your expectation is to sign up as a complete noob and make a bunch of money, you'll most likely be disappointed. Subscription services can only work if you already have a methodology, and are just looking for additional people to get ideas from. You will never make money (apart from mostly luck) trying to follow someone else's method. It has to be your own.

GuitarStv

  • Walrus Stache
  • *******
  • Posts: 9402
  • Location: Toronto, Ontario, Canada
Re: Anyone recommend a Motley fool subscription?
« Reply #15 on: June 01, 2015, 01:23:27 PM »
You will never make money (apart from mostly luck) trying to follow someone else's method. It has to be your own.

Why?

Millions of people have made lots of money without luck by following pretty basic index investment strategies.

oldmannickels

  • 5 O'Clock Shadow
  • *
  • Posts: 95
Re: Anyone recommend a Motley fool subscription?
« Reply #16 on: June 01, 2015, 01:42:50 PM »
I think that they are more journalist and not analysts. The always poke fun at CNBC and then create a ton of content that is pretty much the same as CNBC.

forummm

  • Walrus Stache
  • *******
  • Posts: 7358
  • Senior Mustachian
Re: Anyone recommend a Motley fool subscription?
« Reply #17 on: June 01, 2015, 02:00:33 PM »
Some of the winners I've got from the Fool: ambarella, skyworks, Apple, papa johns.... Most of my stocks are doing well. I also keep an eye on them.

Almost all stocks have done really well the past 6 years or so.

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #18 on: June 01, 2015, 02:36:51 PM »
Way to generalize. My swks shares doubled in under 1 year. Amba is up over 200% in two years. This is above average performance.

HeadedWest2029

  • Stubble
  • **
  • Posts: 101
Re: Anyone recommend a Motley fool subscription?
« Reply #19 on: June 01, 2015, 03:00:05 PM »
I got a subscription to Stock Advisor due to the recommendation of a family member and wanting to learn more about investing after ditching my financial advisor. As others have said, it can help you form your investing strategy and understand methods for evaluating companies, but ultimately after further research I shifted to indexing almost exclusively. The biggest downside other than cost is they spam the living daylights out of you once you sign up for an account...like completely outrageous amounts of spam even with editing your communication settings. Yes, they have picked some "winners" and their share of duds (hello The Container Store), but it really comes down to active vs passive investing. There isn't much difference IMO between paying an expense ratio to a portfolio manager of an actively managed mutual fund versus paying money to a subscription to Motley Fool and just following their advise. Sure, economies of scale come into play at a certain point, but after reading A Random Walk, MMM, Jim Collins Stock series and researching the abysmal performance of active mutual funds, I decided indexing is the way to go. Better to focus on what you control....asset allocation and cost. Let the market do what it's gonna do and sleep well

Financial.Velociraptor

  • Handlebar Stache
  • *****
  • Posts: 1030
  • Location: Houston TX
  • Devour your prey raptors!
    • Financial Velociraptor
Re: Anyone recommend a Motley fool subscription?
« Reply #20 on: June 01, 2015, 03:41:37 PM »
I prefer Stansberry and Associates. For their content and not their over the top dedication to Ayn Randian Libertarianism (Alternately, the Fool will proselytize with mostly left wing propaganda). The Doc Efrig letters are especially good for FIRE as they are conservative and income centric. The Palm Beach Research Group also has some good conservative products but I wouldn't recommend getting both unless you are just a stock analysis junkie; you'll have information overload. I canceled all Motley Fool products after the "Sierra Wireless" advertisement. They went completely overboard, essentially *promising* an 86 bagger and touted it as "the only stock you will ever need to own", clearly against their usual promotion of diversification. I have questioned their commitment to ethics ever since. They lost many subscribers over the flap but have steadfastly refused to issue an apology.

Both MF and S&A will hit your email frequently with pitches to buy more of their products. It is a little annoying. The main difference to me is I've never seen the S&A marketing violate the company's own stated principles like with the Sierra Wireless ad. I still use the CAPS game at MF and continue to enjoy the writing of Morgan Housel.
Achieve Financial Escape Velocity - Financial Velociraptor

decessus

  • 5 O'Clock Shadow
  • *
  • Posts: 44
Re: Anyone recommend a Motley fool subscription?
« Reply #21 on: June 01, 2015, 11:39:53 PM »
Great, thanks for all the input on Motley Fool. I have noticed so many emails from them, I was a bit turned off. I think I plan to stick with index funds. It just makes sense as a strategy for me as I am not up for following lots of individual stocks.

innerscorecard

  • Pencil Stache
  • ****
  • Posts: 590
    • Inner Scorecard - Where financial independence, value investing and life meet
Re: Anyone recommend a Motley fool subscription?
« Reply #22 on: June 02, 2015, 01:45:08 AM »
I think it would not be completely indefensible to subscribe to one of the newsletters, even though I personally have never done so and do not plan on ever doing so. But on the other hand, as I recently remarked on Twitter, their recent landing pages trumpeted their stock picks in Fossil and Lumber Liquidators. They really need to update those, as it makes them look ridiculous (even though in fact even good services will pick bad stocks among good ones - it's just funny that of the few stocks they picked as successes, there were some that failed immediately thereafter).
Inner Scorecard - Where financial independence, value investing and life meet: http://innerscorecard.co/

mrpercentage

  • Handlebar Stache
  • *****
  • Posts: 1236
  • Location: PHX, AZ
Re: Anyone recommend a Motley fool subscription?
« Reply #23 on: June 02, 2015, 03:50:28 AM »
I have thought about doing that. I love their tweets and run into their stuff doing online searches a lot. I just don't want to dish out money I could be investing due to smaller capital. I end up reading the free version of Seeking Alpha, read Joshua, watch Cramer, and read (or more like listen to) books. the next will be One Up on Wallstreet.

Today was a really good day 1.32% in my Robinhood account-- Scottrade was even better. I track every day and log it. Some think Im a fool for doing it, but I think of it as scientific observation.

absolute truth... prison guard that has seen shanks does not makes 45k a year managing bullshit tech that was outsourced for what?.... cheaper tech and less taxes... probably

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #24 on: June 02, 2015, 04:52:35 AM »
I'll mention that sauls investing discussions is a fantastic sub forum on the free portion of the Fool, if you are into stocks and like analysis. His personal returns are phenomenal and the board attracts a bunch of very smart people.

TomTX

  • Magnum Stache
  • ******
  • Posts: 2694
  • Location: Texas
Re: Anyone recommend a Motley fool subscription?
« Reply #25 on: June 02, 2015, 05:15:45 AM »
The Motley Fool forums were always good. The paid analysis... not so much.
Credit card signup bonuses:

$150 bonus on $500 spend for Chase Freedom:
https://referyourchasecard.com/2/MU4TDQ1N3K

$50 bonus (no min spend, just use it once) plus double all cash back at the end of 1 year for Discover, including the initial $50:
https://refer.discover.com/s/37e3u

$500 bonus on $4,000 spend for Chase Sapphire Preferred:
https://referyourchasecard.com/6/Z8JIP66H7G

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #26 on: July 29, 2015, 12:55:57 PM »
I highly recommend the Motley Fool. I follow their advice pretty much to the letter - and I've been tracking my performance compared to investing it all in the S&P 500 with all dividends reinvested since 2007 (before the financial crisis) I've been investing much longer than that but brokerage statements only go back so far.

The results of this is that I've outperformed the "market" by over 50% total over that period. Basically I have outperformed by about 5% per year. That's a big deal. I'm no genius, I'm just playing a different game than the wall street folks.

I have some index investments in my 401K but other than that I'm all individual stocks.

The studies that show that "active managers" don't outperform don't apply to individual investors in my humble opinion. It's blindingly obvious, that on average the performance of an investment is only going to be as good as the overall performance, minus fees, of the market. A lot of ink has been spilled proclaiming the obvious. That being said, I believe that the individual has many advantages over the institutional investors.

1: We don't have to compete with anyone else for quarterly performance. We can hold on as long as we want. Time frame is the biggest advantage.
2: Invest in businesses not names or charts or whatever. Buy excellent companies and hold on to them for a long time.
3: We can control our own behavior. I didn't sell out in March 2009 in fact I was buying all the way down and back up. Mutual fund managers don't get to stop people from panic selling - and are forced to liquidate good stocks at the worst time, and forced to buy after a huge upswing, too.
4: My small purchases aren't going to move the market. And since I hold for a long time, even if I did get a few pennies shaved off for trading friction and such, who cares?
5: Even index funds have ongoing costs. An $8 commission on a $6000 investment that I held for 14 years has less than 0.01% annual expense ratio. And now the stock is worth $260K

Now, the average individual investor buys high and sells low, panics at the worst possible times, chases performance, jumps on the latest hot stock, and basically is his own worst enemy. I'm interested in capturing the results of that bad behavior for myself.

If you can control your behavior and avoid these mistakes for the most part (nobody is perfect) then I think that beating the market is pretty easy.

Index investing is fine. Know yourself and if you can't behave properly then just set it and forget it. Otherwise it's worth the effort.

50% more dollars in my account says that this is true.


"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes

PeteD01

  • Bristles
  • ***
  • Posts: 380
Re: Anyone recommend a Motley fool subscription?
« Reply #27 on: July 29, 2015, 04:08:13 PM »
I highly recommend the Motley Fool. I follow their advice pretty much to the letter - and I've been tracking my performance compared to investing it all in the S&P 500 with all dividends reinvested since 2007 (before the financial crisis) I've been investing much longer than that but brokerage statements only go back so far.

The results of this is that I've outperformed the "market" by over 50% total over that period. Basically I have outperformed by about 5% per year. That's a big deal. I'm no genius, I'm just playing a different game than the wall street folks.

I have some index investments in my 401K but other than that I'm all individual stocks.

The studies that show that "active managers" don't outperform don't apply to individual investors in my humble opinion. It's blindingly obvious, that on average the performance of an investment is only going to be as good as the overall performance, minus fees, of the market. A lot of ink has been spilled proclaiming the obvious. That being said, I believe that the individual has many advantages over the institutional investors.

1: We don't have to compete with anyone else for quarterly performance. We can hold on as long as we want. Time frame is the biggest advantage.
2: Invest in businesses not names or charts or whatever. Buy excellent companies and hold on to them for a long time.
3: We can control our own behavior. I didn't sell out in March 2009 in fact I was buying all the way down and back up. Mutual fund managers don't get to stop people from panic selling - and are forced to liquidate good stocks at the worst time, and forced to buy after a huge upswing, too.
4: My small purchases aren't going to move the market. And since I hold for a long time, even if I did get a few pennies shaved off for trading friction and such, who cares?
5: Even index funds have ongoing costs. An $8 commission on a $6000 investment that I held for 14 years has less than 0.01% annual expense ratio. And now the stock is worth $260K

Now, the average individual investor buys high and sells low, panics at the worst possible times, chases performance, jumps on the latest hot stock, and basically is his own worst enemy. I'm interested in capturing the results of that bad behavior for myself.

If you can control your behavior and avoid these mistakes for the most part (nobody is perfect) then I think that beating the market is pretty easy.

Index investing is fine. Know yourself and if you can't behave properly then just set it and forget it. Otherwise it's worth the effort.

50% more dollars in my account says that this is true.

You made my day! If only we could all be like you!

NorCal

  • Pencil Stache
  • ****
  • Posts: 530
Re: Anyone recommend a Motley fool subscription?
« Reply #28 on: July 29, 2015, 05:21:02 PM »
I've never used their paid services, but I read a number of their articles.

I previously worked at a big MegaCorp, and I got to see all the financials and internal analysis of the business before earnings. Then I would occasionally read the Motley articles on what they thought of my company.

Bottom line, Motley articles were full of it. They didn't understand our business at all. In once case their "analysis" of our unit economics was off 100:1. This is something simple arithmetic applied to publicly available numbers would have caught.

Their overall buy/sell recommendation happened to be right, but they called it for all the wrong reasons.

I'd skip it.

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #29 on: July 29, 2015, 05:34:32 PM »


You made my day! If only we could all be like you!

I know that was meant to be sarcastic, but really, why can't you?
"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes

Roundabouts

  • 5 O'Clock Shadow
  • *
  • Posts: 11
  • Location: Sydney
Re: Anyone recommend a Motley fool subscription?
« Reply #30 on: July 30, 2015, 08:12:19 PM »
To benefit by picking individual stocks, you will be investing your time. Remember that your time could also be spent earning money, so there is an opportunity cost.

This is something I'm coming to the realisation of. I started investing a few years ago and subscribed to MF due to their "how to start investing" articles (way before MMM). I found them great at exciting me about the possibilities of investing, and also introduced me to concepts like asset allocation (which lead me to William Bernstein's book, and then to the Bogleheads). Anyway, I'm realising that the amount of time I spend researching and worrying about individual companies is keeping me from expanding my horizons in other ways e.g. new fun hobbies, or new job-related learning, so I've begun the switch over to index funds.

innerscorecard

  • Pencil Stache
  • ****
  • Posts: 590
    • Inner Scorecard - Where financial independence, value investing and life meet
Re: Anyone recommend a Motley fool subscription?
« Reply #31 on: July 30, 2015, 09:15:00 PM »
I've never used their paid services, but I read a number of their articles.

I previously worked at a big MegaCorp, and I got to see all the financials and internal analysis of the business before earnings. Then I would occasionally read the Motley articles on what they thought of my company.

Bottom line, Motley articles were full of it. They didn't understand our business at all. In once case their "analysis" of our unit economics was off 100:1. This is something simple arithmetic applied to publicly available numbers would have caught.

Their overall buy/sell recommendation happened to be right, but they called it for all the wrong reasons.

I'd skip it.

Very interesting. Did you read anyone who DID get it right, in your opinion? Sell-side research? Buy-side theses? Individual investors?
Inner Scorecard - Where financial independence, value investing and life meet: http://innerscorecard.co/

NorCal

  • Pencil Stache
  • ****
  • Posts: 530
Re: Anyone recommend a Motley fool subscription?
« Reply #32 on: July 30, 2015, 10:07:45 PM »
I've never used their paid services, but I read a number of their articles.

I previously worked at a big MegaCorp, and I got to see all the financials and internal analysis of the business before earnings. Then I would occasionally read the Motley articles on what they thought of my company.

Bottom line, Motley articles were full of it. They didn't understand our business at all. In once case their "analysis" of our unit economics was off 100:1. This is something simple arithmetic applied to publicly available numbers would have caught.

Their overall buy/sell recommendation happened to be right, but they called it for all the wrong reasons.

I'd skip it.

Very interesting. Did you read anyone who DID get it right, in your opinion? Sell-side research? Buy-side theses? Individual investors?

The type of institution research came from didn't seem to be relevant. It was an obscure industry. Most sell side research got it wrong. I never saw buy-side stuff. There was one guy on SeekingAlpha that clearly knew the industry, and one or two (of over a dozen) sell-side analysts that seemed to get it.

The challenge is that the stuff from the people who clearly didn't get it was written just as well as the stuff written by those who did.

Of course, everyone rightly had a "buy" recommendation on us at the time, so it's not like it made a lick of difference.

Left

  • Handlebar Stache
  • *****
  • Posts: 1155
Re: Anyone recommend a Motley fool subscription?
« Reply #33 on: July 30, 2015, 11:53:12 PM »
no one else wants it just for reading material?

I do like to read stock articles because I like to see how other people view it... then I go back to indexing myself...

It's nothing more than a magazine subscription like Nat Geo or nature or whatever your choice is to me.

sol

  • Walrus Stache
  • *******
  • Posts: 5606
  • Location: Pacific Northwest
Re: Anyone recommend a Motley fool subscription?
« Reply #34 on: July 30, 2015, 11:56:42 PM »
Way to generalize. My swks shares doubled in under 1 year. Amba is up over 200% in two years. This is above average performance.

Maybe by a little bit. The market as a whole is up over 300% in five years. And I got that performance without paying for anyone's advice.

sabertooth3

  • Stubble
  • **
  • Posts: 106
  • Location: MD
Re: Anyone recommend a Motley fool subscription?
« Reply #35 on: July 31, 2015, 06:17:43 AM »
Before I discovered MMM I was an individual investor and purchased a 3-year Stock Advisor membership for $50. It wasn't terrible advice, but some of their picks did spectacularly poorly (NOV is one I distinctly remember). It's not great for beginners because a lot of the stocks they recommend are very highly-priced (e.g. Priceline @ $1,300/share). Overall it's not worth it, but at $16.67/year I'm not crying over the spilled milk.

I did get some value out of their Options service, of which I was offered a free preview/mini-report. I know a lot of people on here are against any kind of individual picking, but you can make some beer money pretty easily with just a little knowledge of options trading. Covered calls and synthetic longs are pretty safe if you pick just about any blue-chip stock (e.g. Apple, Google, Disney, etc.).

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1998
  • Location: EastCoast
Re: Anyone recommend a Motley fool subscription?
« Reply #36 on: July 31, 2015, 08:38:19 AM »

2: Invest in businesses not names or charts or whatever. Buy excellent companies and hold on to them for a long time.

Pray tell; how do I tell what will be an excellent company in the future (20+ years from now) from one that will merely be great one, or an average or poor one?

I do believe IBM, GM, and blackberry were all considered excellent companies at one point..

Your advice makes sense, as long as you can tell the future. Just a minor problem..

hodedofome

  • Handlebar Stache
  • *****
  • Posts: 1110
  • Location: Texas
Re: Anyone recommend a Motley fool subscription?
« Reply #37 on: July 31, 2015, 09:07:33 AM »
Way to generalize. My swks shares doubled in under 1 year. Amba is up over 200% in two years. This is above average performance.

Maybe by a little bit. The market as a whole is up over 300% in five years. And I got that performance without paying for anyone's advice.

Splitting hairs here but if you had a magic ball and bought on March 4, 2009 (the very bottom), VTSMX is up a total of 245% including dividends as of the close yesterday.

hodedofome

  • Handlebar Stache
  • *****
  • Posts: 1110
  • Location: Texas
Re: Anyone recommend a Motley fool subscription?
« Reply #38 on: July 31, 2015, 09:18:04 AM »

2: Invest in businesses not names or charts or whatever. Buy excellent companies and hold on to them for a long time.

Pray tell; how do I tell what will be an excellent company in the future (20+ years from now) from one that will merely be great one, or an average or poor one?

I do believe IBM, GM, and blackberry were all considered excellent companies at one point..

Your advice makes sense, as long as you can tell the future. Just a minor problem..

Just saw this today and was looking for an excuse to post it on this forum. I guess this thread is as good as any.

This is the return of every individual stock in the US from 1983 to 2006. You have to make sure you picked the top 25% of stocks, otherwise your return over that time period was 0%. That means you had a 75% chance of picking a stock that underperformed the market. Let's hope your method (and Motley Fools method) gets you in the right 25%!



Taken from this paper: http://michaelcovel.com/pdfs/TrendingStocksDriveTheMarket.pdf

innerscorecard

  • Pencil Stache
  • ****
  • Posts: 590
    • Inner Scorecard - Where financial independence, value investing and life meet
Re: Anyone recommend a Motley fool subscription?
« Reply #39 on: July 31, 2015, 01:19:49 PM »
I've never used their paid services, but I read a number of their articles.

I previously worked at a big MegaCorp, and I got to see all the financials and internal analysis of the business before earnings. Then I would occasionally read the Motley articles on what they thought of my company.

Bottom line, Motley articles were full of it. They didn't understand our business at all. In once case their "analysis" of our unit economics was off 100:1. This is something simple arithmetic applied to publicly available numbers would have caught.

Their overall buy/sell recommendation happened to be right, but they called it for all the wrong reasons.

I'd skip it.

Very interesting. Did you read anyone who DID get it right, in your opinion? Sell-side research? Buy-side theses? Individual investors?

The type of institution research came from didn't seem to be relevant. It was an obscure industry. Most sell side research got it wrong. I never saw buy-side stuff. There was one guy on SeekingAlpha that clearly knew the industry, and one or two (of over a dozen) sell-side analysts that seemed to get it.

The challenge is that the stuff from the people who clearly didn't get it was written just as well as the stuff written by those who did.

Of course, everyone rightly had a "buy" recommendation on us at the time, so it's not like it made a lick of difference.

Thanks - very interesting.
Inner Scorecard - Where financial independence, value investing and life meet: http://innerscorecard.co/

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #40 on: July 31, 2015, 11:43:04 PM »

2: Invest in businesses not names or charts or whatever. Buy excellent companies and hold on to them for a long time.

Pray tell; how do I tell what will be an excellent company in the future (20+ years from now) from one that will merely be great one, or an average or poor one?

I do believe IBM, GM, and blackberry were all considered excellent companies at one point..

Your advice makes sense, as long as you can tell the future. Just a minor problem..

I've been investing this way for a long time. Sure, some companies go nowhere or drop a lot, but it only takes a few major winners to make up for a lot of losers. I've been investing with the Motley Fool for a long time and I think my results speak for themselves (~50% outperformance over SP500 including dividends since Jan 2007). They are a good service. You may not have the interest or time to dig in to individual companies and index investing is awesome in that case. I generally tell my friends to put their money in VTSAX, unless they really want to spend some time.

On my own, I'm a terrible stock picker, though I have made a couple good calls along with the very bad. By paying for advice from the Fools, I've improved my batting average significantly.

As I tried to point out, the majority of active investors behave poorly and pay dearly by underperforming the indexes significantly. It is my belief that by understanding what makes for good behavior as an investor and practicing it (not easy by any means) it's possible to capture that difference. That money end up in someone's pockets. It might as well be mine.
« Last Edit: July 31, 2015, 11:45:04 PM by PaulMaxime »
"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes

TypicalVillain

  • 5 O'Clock Shadow
  • *
  • Posts: 42
  • Location: California
Re: Anyone recommend a Motley fool subscription?
« Reply #41 on: August 03, 2015, 04:17:28 PM »
I'm a fan of Morningstar. I like that they are less focused on finding "hidden gems" (which sounds like watercooler talk) and more on evaluating established businesses. When I invest in individual stocks I want to know: is the price justified by their cash flow? Do they have consistently high return on invested capital? And do they have a moat (an intangible competitive edge)? They're pretty good about breaking down a company in these terms, calculating intrinsic value, and evaluating uncertainty.

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #42 on: August 04, 2015, 12:45:22 PM »


Your advice makes sense, as long as you can tell the future. Just a minor problem..

Hi. I just wanted to add a comment here. We are all trying to predict the future, even if we only invest in index funds. It's just a matter of degree. You are selecting some subset of assets (unless you somehow buy an equally weighted fund of the entire world, which I suppose is possible) and so am I. Even so, we are likely betting based on some track record of how things have done in the past, that our returns in the future will be enough to maintain our financial independence.

Assuming that I randomly chose 20 or 30 stocks from the entire world, both of us would have the same statistical return, but mine would have a higher potential variability.

I would maintain that making mistakes is a part of investing, so individual examples of companies that have done poorly is not really evidence. I could add as many or more that have done excellently. As long as I have a few companies in the right side of the graph it makes up for a bunch of things down on the left. A stock can only go down 100% but can increase by many times more than that. It only takes 1 4000% return to make up for a lot of losers.
« Last Edit: August 04, 2015, 12:59:13 PM by PaulMaxime »
"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes

zephyr911

  • Magnum Stache
  • ******
  • Posts: 3613
  • Location: Northern Alabama
  • I'm just happy to be here. \m/ ^_^ \m/
Re: Anyone recommend a Motley fool subscription?
« Reply #43 on: August 04, 2015, 01:50:56 PM »
I was a big fan of MF back in their early days, when they were all about teaching you how to do your own analysis and make fundamentally sound picks. I've never entirely forgiven them for reversing their stance and now making their bread and butter selling a service they used to swear was unnecessary.

I actually fell for the SA subscription one time, and I found some interesting ideas in it, but I didn't end up doing anything with those ideas. Will never do it again.
I am not a cog. I am an organizational lubricant.

KBecks2

  • Pencil Stache
  • ****
  • Posts: 652
Re: Anyone recommend a Motley fool subscription?
« Reply #44 on: August 05, 2015, 07:02:35 AM »

2: Invest in businesses not names or charts or whatever. Buy excellent companies and hold on to them for a long time.

Pray tell; how do I tell what will be an excellent company in the future (20+ years from now) from one that will merely be great one, or an average or poor one?

I do believe IBM, GM, and blackberry were all considered excellent companies at one point..

Your advice makes sense, as long as you can tell the future. Just a minor problem..

It's called research and analysis. ;)

BTW, if I haven't said it already, Saul's Investing Discussions is one of the best boards on MF's free forums.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1998
  • Location: EastCoast
Re: Anyone recommend a Motley fool subscription?
« Reply #45 on: August 05, 2015, 07:15:34 AM »

Your advice makes sense, as long as you can tell the future. Just a minor problem..

Assuming that I randomly chose 20 or 30 stocks from the entire world, both of us would have the same statistical return, but mine would have a higher potential variability.

Ok, so you acknowledge the (correct) point that statistically we will both have the average return, whether buying one stock or 10,000. But the volatility of one (or 20) stocks will be orders of magnitude higher. Just this simple fact convince me that owning single stocks is pointless. Statistically you get the same return, but higher risk and volatility. Why bother?


It's called research and analysis. ;)
BTW, if I haven't said it already, Saul's Investing Discussions is one of the best boards on MF's free forums.

Not exactly helpful. But ok; tell me then what kind of research and analysis would tell you that Apple would invent the ipod and iPhone? And that people would ditch their blackberries for them?
Or that BP would suffer the Deepwater horizon disaster? Or that oil prices would collapse?
How could you tell that toyota would take over the market in US?
Or that the government would rescue goldman but not Lehman brothers?
Or that amazon would do great with a decade of losses to go from a bookstore to ...whatever it is now?

There are a million other examples. It just doesn't make much sense to me to look at how much profit they made last quarter to predict a whole lot about the future. Business (and especially stock) success and failure is largely driven by surprises, unforeseen events, government action/inaction, political or weather events etc. The balance sheet tells you nothing about this.

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #46 on: August 05, 2015, 08:54:23 AM »

Your advice makes sense, as long as you can tell the future. Just a minor problem..

Assuming that I randomly chose 20 or 30 stocks from the entire world, both of us would have the same statistical return, but mine would have a higher potential variability.

Ok, so you acknowledge the (correct) point that statistically we will both have the average return, whether buying one stock or 10,000. But the volatility of one (or 20) stocks will be orders of magnitude higher. Just this simple fact convince me that owning single stocks is pointless. Statistically you get the same return, but higher risk and volatility. Why bother?


Ahh, I was making a point that if I wasn't able to make any good decisions we would have the same return. But I believe that once you look past the next quarter and don't try to follow the herd and remove the other constraints that make it hard for professional wall street money managers to outperform the market over time, you can make lots more money buy buying and holding good companies for the long term over and above just buying an index.

I've done it now for many years. I have documented returns of ~50% above the S&P 500 with dividends since 2007. The analysts at the Motley Fool have demonstrated this themselves too over the years.

I don't really care, index investing is easy and you will get above average returns over your life assuming that you conquer the behavioral biases that hurt most investors. I'm just saying that it's possible to do much better if you have the right sources of information and good coaching.

"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #47 on: August 05, 2015, 09:05:58 AM »
[
It's called research and analysis. ;)
BTW, if I haven't said it already, Saul's Investing Discussions is one of the best boards on MF's free forums.

Not exactly helpful. But ok; tell me then what kind of research and analysis would tell you that Apple would invent the ipod and iPhone? And that people would ditch their blackberries for them?
Or that BP would suffer the Deepwater horizon disaster? Or that oil prices would collapse?
How could you tell that toyota would take over the market in US?
Or that the government would rescue goldman but not Lehman brothers?
Or that amazon would do great with a decade of losses to go from a bookstore to ...whatever it is now?

There are a million other examples. It just doesn't make much sense to me to look at how much profit they made last quarter to predict a whole lot about the future. Business (and especially stock) success and failure is largely driven by surprises, unforeseen events, government action/inaction, political or weather events etc. The balance sheet tells you nothing about this.

Right, random events would statistically hit all companies equally if they are truly random events, no? Therefore, they have no overall impact on returns. All the companies in the index are subject to the same random events.

So, the research to pick good long term winners is still valuable. Some of those will perform terribly others will perform amazingly and some will just perform OK.

The beauty of this is that the bad performers can only lose 100%, while winners can gain many times that. You only need to slightly bias your portfolio toward the winners to outperform.

Oh, and diversify. Not too much, but you want a good 20-30 companies in your port. Now, it's probably hard to follow that many companies by yourself, which is why I pay for help from people with a long track record of picking winners over time. Not 100% of the time, for sure.

If you are actually interested in the kind of research that leads to outperforming over time, I suggest listening to David Gardner's Rule Breaker investing podcast. He's one of the co-founders of the Motley Fool and has an amazing track record including a greater than 100 times return on his investment in Amazon. http://fool.com/podcasts/category/rule-breaker-investing/
« Last Edit: August 05, 2015, 09:29:31 AM by PaulMaxime »
"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1998
  • Location: EastCoast
Re: Anyone recommend a Motley fool subscription?
« Reply #48 on: August 05, 2015, 10:21:25 AM »

Right, random events would statistically hit all companies equally if they are truly random events, no? Therefore, they have no overall impact on returns. All the companies in the index are subject to the same random events.

So, the research to pick good long term winners is still valuable. Some of those will perform terribly others will perform amazingly and some will just perform OK.

The beauty of this is that the bad performers can only lose 100%, while winners can gain many times that. You only need to slightly bias your portfolio toward the winners to outperform.

Oh, and diversify. Not too much, but you want a good 20-30 companies in your port. Now, it's probably hard to follow that many companies by yourself, which is why I pay for help from people with a long track record of picking winners over time. Not 100% of the time, for sure.

If you are actually interested in the kind of research that leads to outperforming over time, I suggest listening to David Gardner's Rule Breaker investing podcast. He's one of the co-founders of the Motley Fool and has an amazing track record including a greater than 100 times return on his investment in Amazon. http://fool.com/podcasts/category/rule-breaker-investing/

You have your ideas and we'll never agree. But maybe for the benefit of others..

No, the success of the ipod mainly affected Apple. Deepwater horizon mainly affected BP, etc. The unknown unknowns can't be seen in financial reports. And anyone can access those anyway, so what good does it do? Sometimes it will wipe out an industry (buggy whips..), or do the opposite. Yes if you own the total market the random events will even out, but you don't with individual stocks (if you do you've just made your own VTSAX).

As someone showed further up; 90% of the market performance came from 25% of stocks. So buying a stock you have a 75% chance of underperforming. If you think you can beat those odds and get "enough" great performers than good luck.

I did listen to a motley fool podcast a few times years ago, after a while mainly to laugh at it. Remember mostly they talked about earnings and pontificated on whether they would do better or worse. "I think Coke will increase sale of cola, because.. reasons." Or there could be a soda ban and they won't. Not all that useful.

But I have no interest in listen to all that now. If you hear of just one stock they mention that will go 10x in the next few years could you post it here and we'll have a record of it? I'll quote the post so you can't edit it;)

PaulMaxime

  • Stubble
  • **
  • Posts: 118
  • Location: San Francisco, CA
  • Absolute power doesn't corrupt, it reveals.
Re: Anyone recommend a Motley fool subscription?
« Reply #49 on: August 05, 2015, 12:14:17 PM »
I've been outperforming for too long to go back to indexing. Be open to the possibility that there might be some better ways to invest out there. I could certainly be full of crap, but I've done well investing this way and just want to help others do well. Just because the current meme is that indexing is the be all and end all of investing doesn't make it so.

I'm sure I'm not going to convince you, but perhaps for the benefit of others. ;-)

I'm not giving you a stock pick. It doesn't work that way - I don't know what's going to go up 10X in the future. That's why you do your research and spread your bets. You seem obsessed with the fact that a single stock pick can go badly. I get it, pain of losses generally outweighs joy of gains, when in fact gains can be essentially unlimited and cancel out losses which are limited by their nature over time. My worst stock investment definitely went to ZERO. But my best one has made me many times more than that and more than made up for that one.

You claim that I have a 75% chance of my picks underperforming. Random chance may say that. However, while looking at my portfolio, I have 58% of them outperforming, some by a lot. The vast majority of my invested capital is on that side of the scorecard since I tend to add to my winners over time.

Like I said before index investing is great if you don't want to spend a lot of time on your investments. I've decided that the outperformance is worth the time and I like learning about companies and investing.

In reality, most of the reason that people do poorly in investing is their behavior - poor timing, panic selling, chasing performance, etc. None of this changes if you choose index funds or stocks or anything else. How many people sold everything in 2009 and are still sitting around waiting for a pullback to get back in while they missed out on the greatest rally they likely will ever see in their lives? I personally know many of these people.

I'm not paid by the Motley Fool, and don't stand to gain in any way from what I've been saying on these boards. I'm just a satisfied customer.

The odds of me being ridiculed for my unorthodox opinion is high, here in the high church of the index fund. That's OK, I don't mind. We Mustachians should be questioning the conventional wisdom where we find it.

"When my information changes, I alter my conclusions. What do you do, sir?" - John Maynard Keynes