Share Advisor - Is It Worth It?

[Deactivated] on 17/09/2016 - 11:26

Hi guys,

I am quite a newbie in stock investing. I'm curious to your opinion towards share advisors, such as motley fool, Australian stock report, intelligent investors, fat prophet, etc.

Motley fool pro version, which costs $5000 for 3 years, promises that themselves investing their own $1m in it. They claim they have return of 92% in the past 3 years.

Australian stock report recommendations involved short selling, and overall they claim a return of 30-40% yearly. I think from memory they costs around $2k yearly. They have very aggressive sales people.

I'm not too sure about the others pricing or performance, but more importantly, I'm curious of its worthiness.

What's your experience about it?

Financial

Comments

  • JIMB0 on 17/09/2016 - 11:53
    +6

    No one can consistently get returns like that year after year., however there's a lot of money to be made selling the dream of getting rich quickly.

    • [Deactivated] on 17/09/2016 - 13:15

      I quite agree on both parts, however I must admit myself have no idea what to look for in stocks, and desperately clinging on recommendations, free or not.

      Motley claims that their research includes interviewing the CEO from time to time.
      They also said that the investment amount should be no less than 50k, with 100k is better.
      I must say 100k savings is quite rich already.
      It's not like turning $1 to $1B is a year, so I don't think Motley or the other advisors companies try to sell the dream.

      • Diji1 on 17/09/2016 - 14:13
        +2

        There are two people in history that are known to have correctly predicted the market over a long term period. One of them is Warren Buffet, forget the other. Neither sells people recommendations.

        That is the same as saying no one has predicted the market in the long term.

        Do not pay for stock advice, it's a legal scam.

  • rickb on 17/09/2016 - 11:54

    A friend of mine signed up to Motley Fool Pro and he's returns have been superior to his previous attempts at doing it himself. He's always offering to share the recommendations with me but I have the luck of the Irish.

  • idjces on 17/09/2016 - 13:29

    I never really liked any of the free motley fool articles I've read (on the local shares). However I came across the podcast and it's a pretty good listen when you've got idle time. It's based on U.S. stocks - which also means that 92% figure wasn't exactly a terribly difficult task given the U.S. bull market of late. It's easier to make 90% when the market itself is up at least half that much. I would like to see how everyone performs peaking over and into a recession (I wasn't educated in the area the last time, 2007-2008).

    Here's the link if you want a listen of the podcast. It might help satisfy the itch, so to speak.
    http://www.fool.com/podcasts/motley-fool-money

    • [Deactivated] on 17/09/2016 - 14:13
      +1

      The 92% was on Australia only.

      Thanks for the link.

  • tessel on 17/09/2016 - 15:12
    +4

    If providers can promise such good returns, then why are they selling the service? I know people fall for it because they want to "get rich", but if their stock/share advice was so reliable then they would simply keep it to themselves because they'd be billionaires following their own advice. I think there is nothing wrong with paying to learn the fundamentals of how to trade, be it stocks or another instrument, but ultimately you need to make your own decisions about what to buy or short. It's not bloody easy and if it was we'd all be rich.

    • geoffs87 on 17/09/2016 - 16:49
      +2

      Pretty sure their advice gets people to buy stock which they had already purchased. Increased demand in a stock (ie from their 'devoted investors') results in increased price (law of supply and demand). Because they got in before their pool of investors spiked the price, they subsequently make a profit…

      Similar to the 'Icahn Lift' (http://www.investopedia.com/terms/i/icahn-lift.asp) without Motley taking a controlling stake in the firm, but with the subsequent lift.

      Oh, and their ability to make those investments is all from the annual fees you pay them.

      That's my 2cents anyway…

      • tessel on 17/09/2016 - 17:03

        Exactly. Pump and dump. Their advice isn't worth it.

      • rickb on 17/09/2016 - 18:06
        +2

        The Motley Fool Pro method works differently.

        The way I understand it is that they advise their customers to buy the stock at a certain price range and then Motley Fool buy the stock 2 days later.

        I can understand why you guys are sceptical (I would be too) but my friend has done quite well out of it.

        • [Deactivated] on 17/09/2016 - 18:43

          I didn't know that they buy later? I must missed that part in that super long email.

          I have to scroll for 5 seconds to find the buy button.

    • [Deactivated] on 17/09/2016 - 19:01

      +1 for such a solid comment.

      I am not 100% convinced though, it can't be that simple, is it?

      Put it in the extreme, if I know a stock that will surely raise in value, would I keep it quiet, or would I tell my friends and family about it? Would I charge strangers for my tip? There is no advantage in not telling people, there is some advantage however by telling people, because it will raise the value. The advantage is not a lot however, because people will still read the key metrics, and when it should go down, the majority will sell.

      • rickb on 17/09/2016 - 19:22

        Please don't take my comments as a recommendation for their service. Just observations that I have gathered in coffee discussions with a friend who is generous enough to pass on the trade alerts even though he forked out the money. School fees and other expenses take priority so I can't afford to invest at this stage.

        Some years ago we both got burnt by another share advisory service so I was quite surprised that he jumped onto this one. This time he has done quite well.

        Would I do it later on when the school fees are out of the way? I'm not so sure. I'm coming to the conclusion that superannuation is a better investment model for me and my circumstances.

  • Lostatsea12 on 18/09/2016 - 08:13

    I have the Australian Motley Fool Share Advisor and Dividend Investor and have had for 3 years now for my SMSF.

    I have averaged about 18.5% (with reinvested dividends) returns using Motley Fool. Some of their recs have had some very heavy losses and some have almost tripled in value.

    The best advice I could give anyone is don't invest (or believe) everything you read in the reports (not saying they are not truthful at all) but rather corroborate it with third party sources, company reports and the like. If I don't understand or can't find the info I need I don't invest, likewise if it doesn't fit my moral compass. I have missed out on some great returns (and losses) this way.

    I guess all I am saying is that Motley Fool (like all the others) is an ADVISORY service, not a bible, set your own path having due regard to their advice.

    If at the end of the day you don't have the confidence/skill or experience then look at your super fund or an ETF (I have more than a few ETF's but mainly in foreign markets and commercial property where I don't understand or have experience).

    Has my Motley Fool paid for itself - absolutely.

    Would it if I had followed them blindly, probably, but not nearly as well.

    Hope that helps

  • StuffnStuff on 18/09/2016 - 08:24
    +1

    I used to use Fat Prophets, an easy to read news letter with recommendations. BUT the problem I found was that each news letter might have 6-10 recommendations, you obviously cant take them all. So you need to try and pick the winners from list which never worked for me. Plus the in/out costs with shares can be expensive. I had a few companies fold that I invested in, they look good on paper one day and gone the next. I now trade currency and indexes, been much more successful than with any of my share trading.

    • [Deactivated] on 18/09/2016 - 08:48

      How much was fat prophet? And do they tell you when to sell?

      • StuffnStuff on 18/09/2016 - 10:00
        +2

        I was with them in 2005 , they charged $600 per year back then. Occasionally they would say if to sell or not but not on all recommendations from what I recall. Back then they were more of a recommendation service versus an alert service which tells you when to buy and sell. They used to give you trial memberships to check them out that would give you a free month with access to all previous material.
        The best bit of advice I can give if playing with stocks/currency/indexes, is learn to take and accept a loss and know how much you are prepared to lose before entering. ie. If you think I'm entering this and risking $200 as a possible loss, then if it is down $200…get out and accept the loss. If you hesitate and think it will get better it could be down $1000 the following day.

        • [Deactivated] on 18/09/2016 - 10:02

          True, I hesitate sometimes and lose more…

  • boccos on 18/09/2016 - 08:28

    There are no persons alive that can predict the future other than by a guess. Therefore any advice given is based only on historical data. So if you are wanting to take a gamble, and it is a gamble, on buying shares short-term in order to sell them when their price rises, then there are plenty of free recomendations in your newspapers and magazines.
    If it is your intention to invest in shares in order to get and income from dividends, then the ASX has a free service that you can access which tells you what the historical and current dividends for listed stocks.
    Now that we live in an age of globalisation, do not be fooled into thinking diversifcation means spreading the risk. It does not, as in the GFC, once the stocks dropped so then did almost every other type of investments (bar Gold), property trusts and the like. Markets go up with a crawl and go down like a dropped stone, ruled by fear and greed. It is a really stupid, shallow system that the power economies of the world created and cleverly control and is in part, a way to rid many inexperienced folk of their money. Tread warily.
    On the bright side, there are a score or more fine ASX listed companies who are worth investing in, but on careful examination they number less than about 2% of the whole ASX.

  • simmogunner on 18/09/2016 - 08:31

    I've had the Share Advisor before and cancelled my subscription mid way through the first year. There's some really good things about it as a product and a few really annoying things that made me cancel. Firstly I didn't like the fact that they seperated all the different 'products'. Not sure if they still do this but things like Hidden Gems, Dividend, value etc. I get they need to grow their brand but I see this as a bit of a conflict as all I really care about is value. Dividends come and go, stocks can be over priced at $0.05 a share and $100 a share companies can go bust. Fundamentally you want solid companies that are well run and will outperform the market. Yes there's more rough diamond options for those chasing quick hits but I didn't like the thought that a stock that paid a stable Dividend wouldn't be recommended to me because I had subscribed to a different product. Secondly I didn't like the sudden changes of minds. The Podcast that comes with the subscriptions goes in length to discuss why shares are buys then, all of a sudden, recommendations go from screaming buys to sells in a matter of months. Yes things change and I wasn't expecting every stock to be a winner but you can't say a stock can go from a buy to a sell after a few months and losing 50% of its value. In my mind if the fundamentals are still there then it should be a hold at worst after a stock has lost half of its value. In my mind this was to 'cut their losses' on their scorecard.

    Plenty of good stuff about them as well but I feel that 80% of their budget is spent spruking their product and 20% in the product itself.

    Ive been in shares for the past 4 years now. If I was to start again I wouldn't bother with individual shares. Low cost LIC's likee AFI and ARG aren't sexy but they're stable, risk adverse and pay a good Dividend (even during the GFC). My two cents anyways about my dealings with Motley Fool.

    • temporiser on 18/09/2016 - 14:00

      Similar to Port Phillip publishing

  • lurkernomore on 18/09/2016 - 09:30
    +1

    Go with the Barefoot Investor. Sensible, no nonsense advice. He puts his own money where his mouth is. Around $400/year (which he'll refund to you if you don't like it).

    • [Deactivated] on 18/09/2016 - 10:05

      Never heard of this one before, how do they work?

      • Oofy Doofy on 18/09/2016 - 13:03

        He's very much into paying off debts, living simply/economically, and investing conservatively in LIC's with long track records (AUS only). He does like certain ETF funds, but all in all over the long haul the belief is that they all return similar growth (to a comparative fund). I don't think you can go wrong with his advice overall, conservative, intelligent and sensible. Heck, ask him a question or just search through the huge amount of Q&A's on the website.

        There are other investment forums online that purely believe in low cost ETF products and just investing in 1 to 2 well diversified funds at most, then forgetting about it and adding to it for as long as possible.

        I personally am investing a large sum of money into a combo of ETF's & LIC's very soon, I'm using MotleyFool's perfect portfolio guide and changing a few of their selections to offerings I'm more comfortable with.

      • lurkernomore on 18/09/2016 - 14:57
        +1

        To get a feel for what he's about, go to his website, go to the top where it says 'Steal my wallet', plug your details in and you'll get his weekly column emailed to you. You can see if you like his style, then buy if you so wish (BTW, he often has a Christmas/New Year discount). And if you later decide it's not for you, get a refund.

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