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For some investors, picking individual stocks is part of building a successful portfolio. However, deciding which stocks to add to the portfolio can be a challenge.
The Motley Fool is one of the most successful investing websites and offers different newsletter choices for helping you identify promising stocks to invest in. Two of the choices, Stock Advisor and Rules Breakers, can provide you with helpful insights and ideas. Here’s what you need to know about Motley Fool Stock Advisor vs. Rule Breakers.
Motley Fool Stock Advisor vs. Rule Breakers Overview
Both Stock Advisor and Rule Breakers are published by The Motley Fool, which was founded by brothers Tom and David Gardner. Both newsletters claim that their picks far exceed the regular returns of the market, so the theory is that if you add the picks from these newsletters to your portfolio, you’re likely to see good results.
About Stock Advisor
In order to provide stock picks, Tom and David each use a team of analysts. There’s a new stock recommended each month by each team (two recommendations per month). The idea is that these stocks are likely to provide solid long-term returns in a portfolio. Stock Advisor also offers a list of five stocks that should be bought with new money.
Tom and David have slightly different styles when analyzing and picking stocks, and their teams recommend stocks accordingly. Tom takes a more concrete approach, using fundamental analysis. While David’s picks also rely on data analysis, he also uses intangibles that are a bit less rigorous and based more on a gut feeling.
About Rule Breakers
Rule Breakers stocks are hand-picked by David. The focus is on stocks that are considered opportunities for growth. As the name implies, Rule Breakers takes a look at companies that might be counterintuitive additions to your portfolio. However, Rule Breakers also includes “Starter Stocks” that can help you get a jumpstart on your portfolio.
How Motley Fool Rule Breakers vs. Stock Advisor Work
Both of these newsletters are from The Motley Fool and rely heavily on the personalities of the founders of the company.
How Motley Fool Rule Breakers Works
Basically, David Gardner and a team of analysts try to identify stocks that have some sort of “it” factor — a distinct competitive advantage — that could propel them to high growth even if it seems like there’s something a bit off with the fundamentals of the company. The newsletter makes recommendations and if you choose to go along with those recommendations, you could potentially see big gains.
Specifically, Rule Breakers provides two new stock picks every month that are high-conviction buys. New members also get five “best buys now” picks that are Motley Fool’s favorite companies out of 200+ candidates.
Picks from Rule Breakers, according to The Motley Fool, are up 174% since it started in 2004, as of June 20, 2022. However, it’s important to note that even though there’s a high potential for growth, there could also be a high potential for loss. Rule Breakers stocks don’t always perform as well as expected. On the other hand, the successes might make up for the failures.
How Motley Fool Stock Advisor Works
Both Tom and David Gardner make recommendations in this newsletter. Tom’s style of fundamental analysis tends to lean toward value stocks and those that are likely to provide long-term returns that are a little more stable. Once again, for this newsletter, David is more likely to recommend stocks that are a little less conventional but could be poised for a breakout.
Like Rule Breakers, Stock Advisor also provides two new stock picks per month. You also get 10 timely buys chosen from 300+ stocks.
Since its start in 2002, according to The Motley Fool, Stock Advisor picks have returned 309%, as of June 20, 2022.
Unique Features of Motley Fool Stock Advisor vs. Rule Breakers
Both of these newsletters are about picking stocks, and they come from the same source, The Motley Fool.
How Are They the Same?
- The focus is on individual stocks and recommendations for specific stocks to add to your portfolio.
- You can find out about different types of analysis and learn the decision-making process behind each.
- Both consistently beat market performance over time.
How Are They Different?
- Uses picks from both Tom and David Gardner.
- Focuses on more conventional stocks.
- Looks for stocks that should be held for at least five years.
- Stock Advisor currently has a higher average return since its inception than Rule Breakers.
- Only uses picks from David Gardner and his team of analysts.
- Focuses on companies that are counterintuitive but could win big.
- Offers a list of stocks for starting a portfolio.
Pricing and Plans
- Stock Advisor: $199 per year ($99 for the first year)
- Rule Breakers: $299 per year ($99 for the first year)
Both newsletters have access to The Motley Fool customer service. This is available through email, as well as offering phone support 9 A.M. to 5 P.M., Eastern Time, Monday through Friday.
Who Are The Best For?
In general, Rule Breakers is ideal for those who are looking to add big winners to their portfolios. With Rule Breakers, you’re going to get more sell recommendations, as well as the buy recommendations, because at some point you’ll need to unload your stocks. You might consider Rule Breakers if you have a higher risk tolerance since some of the picks might not perform as expected.
On the other hand, Stock Advisor can be a good choice for someone who wants to build a portfolio with individual stocks but is looking to buy and hold companies. Stock Advisor is also aimed more at those who are interested in value stocks.
When looking at Motley Fool Rules Breakers vs. Stock Advisor, it’s important to consider your own portfolio goals to determine what’s likely to fit your investing style. And you can subscribe to both and get access to different ideas for different areas of your portfolio.
Alternatives to Motley Fool Rule Breakers and Stock Advisor
1. Zacks Investment Research
This is a newsletter that offers investment research and makes reports. Using this service, you can get screeners for a variety of stocks and purposes. Some major brokerages include Zacks, so you might already have access. You can get Premium membership for $249 per year and get access to additional tools and resources.
Find out the differences between The Motley Fool vs. Zacks Investment Research in our review.
2. The Street
Famous investing show host Jim Cramer is part of the team at The Street and if you want access to some of his picks, you can choose various subscriptions. You can get access to Action Alerts PLUS for $29.99 per month and see what you should be buying and selling. There are discounts if you commit to one or two years at a time.
Find out the differences between The Motley Fool vs. Action Alerts PLUS in our review.
3. Investor’s Business Daily (IBD)
Get access to regular insights on stocks and industry trends. You can read the latest investment news and see basic analysis for different companies based on what’s happening and various trends in the market. The first two months cost $20, after which you pay $34.95 per month.
You can find out more about the Motley Fool vs. IBD in our review.
4. Seeking Alpha
If you want free content, Seeking Alpha offers a variety of viewpoints and ideas from different writers. However, you can also subscribe to a premium service from Seeking Alpha that goes more in-depth on research and ideas. This costs $29.99 per month or $19.99 per month if paid annually.
You can find out more about the Motley Fool vs. Seeking Alpha in our review.
5. Other Motley Fool Services
Stock Advisor and Rule Breakers are two of the oldest and most popular premium services Motley Fool offers. But it also has other premium services you can consider like:
- Everlasting Stocks ($299/Year): Provides stock picks from Tom Gardner’s analyst team and his portfolio.
- Rule Your Retirement ($149/Year): Offers three different model portfolios and mutual fund and ETF picks to help you build a retirement portfolio.
- Everlasting 10X ($1,999/Year): Looks for companies that have the potential to 10x within the next five to 15 years.
- Mogul ($2,499/Year): Recommends various public and private class real estate investment options.
It’s also worth noting that unlike Stock Advisor, Rule Breakers also has various sub-categories and more premium versions you can explore. For example, you can subscribe to editions of Rule Breakers that focus on sectors like biotech, energy, augmented reality, artificial intelligence, and fintech. Most of these editions cost $1,999 per year.
Stock Advisor vs. Rule Breakers: Which Is the Best?
If you’re new to stock investing and need a helping hand building your portfolio, Stock Advisor is your best pick. This service provides an excellent foundation of companies you can invest in plus plenty of educational resources to help new investors.
In contrast, Rule Breakers is best if you already have some investing experience and want to add a few more niche picks to your portfolio. It’s also better than Stock Advisor if you have a higher risk tolerance and are really seeking to outperform the market.
In the end, what works best for you depends on your investing goals, risk tolerance, and the way you build your portfolio. Both of these newsletters are offered by The Motley Fool, which has a long track record of finding winners, whether it’s with high-growth picks or with longer-term buy-and-hold picks. Figure out what you want to accomplish with your portfolio and choose the newsletter that’s best for you.