I started my investing journey 6 years ago, when I discovered Motley Fool during the pandemic. I bought numerous MF portfolios, and exclusively bought stocks MF recommended over the next two years. Many, presented as super high confidence. I went deeeeep into MF. Was a huge fan. Spent hundreds and hundreds of hours on MF material and podcasts. I held my stocks for 4-6 years. My annualized returns are 4%. Awful. I would have done almost four times better in the S&P. I would caution anyone considering investing in an MF portfolio. You may do four times better in the S&P. And with hundreds of hours less effort. And for free. I think people should know
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That’s been know for years – and it’s not just the Motley Fool.
Over the long-term (15 years or longer), a Buy & Hold investment the S&P 500 has beaten about 95% of professional money managers and stock pickers, and probably 98% of the amateur investors.
{{ In a 1997 speech, Jack Bogle, the founder of Vanguard, laid out a very simple theory: “Investors as a group cannot outperform the market, because they are the market,” he said. In fact, he took that a step further by saying investors, as a group, must underperform the market “because of the costs of participation.” Those costs include things like transaction costs, administrative fees, and the expense ratio on your mutual funds. }}
And note the author of the article linked above – Adam Levy, The Motley Fool, March 5, 2025
It’s very hard to beat a Long-Term Buy & Hold investment in a low-fee index fund.
intercst
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You were a newbie.
Are you still a newbie?
What did you learn?
What will you do differently, going forward?
ralph
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Yeah I learned a ton. The most important thing I learned is that I could have done four times better in the S&P than with MF recommended stocks.
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In terms of what I’ll do differently going forward… I’ll buy an S&P fund instead. And save myself hundred of hours of work and thousands of dollars in MF portfolio fees. And perhaps do four times better
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I don’t know how old are Tom Parker, but the earlier you learn this the better.
I was very fortunate to take a 3-day “Investment Philosophy” course as an 18-year-old Freshman in engineering school way back in 1975. There I learned about “fees, commissions, trading costs and taxes” and why you want to avoid them as much as possible. It’s by far the most valuable course I took at the very fine college I attended.
Of course, at 18 years old I had no money to invest, and student loans to repay after I graduated, but once I did have money to invest at about age 25 or so, I knew what to avoid.
intercst
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…regarding “fees, commissions, trading costs and tax”… All I’ve done is buy and hold. So those things should have minimal effect on my portfolio. And I’ve still only got 4% annualized returns
Over the past 50 years, only a small number of stocks in the S&P 500 are responsible for most of the index’s return. So if you have a portfolio of 20 stocks, you need to have 2 or 3 of these “winners” to keep up with the index. A long-term buy & hold portfolio of the “wrong” stocks will under perform. That’s why the low risk/high return move is to simply buy the whole market (i.e., the index fund).
And keeping fees and trading costs low does have a large effect. Over 60 years, an annual 1% fee will take over one-third of your wealth versus an index fund.
intercst
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OK, so you didn’t do as well as you thought you should. There are lots of people out there selling systems that are supposed to make you rich, everything from ValueLine to the Wall Street Journal (CNBC, Kramer, Schwab, Fidelity, Morningstar, and of course the “We do better when our clients do better” fishmongers, Fisher Investments.) And that’s just a tiny fraction of the list.
Think of this period in your investing life as “education”, for which you paid “tuition.” We’ve all had wins, and we’ve all had losses. Everybody who comes out of college with a shiny diploma doesn’t get the same result either.
Decide if you want to let the market handle your finances (index funds, etc) or whether to take a more active role. Then pull up your big boy panties and get on with it. Nobody promised you a rose garden.
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Better call Saul.
haha
MoneySlob
39.45% YTD
I’m swing trading the stocks that Saul’s wonderful participants share at the end of the month. Especially Wpr101.
I don’t know squat about trading. I just have a knack of listening to people smarter than me. And giving credit where credit is due.
I did lose everything '21 and '22. I flew too close to the sun thinking Bull market would never end.
Nowadays I have a 5% trailing stop on everything. Maybe I’m not the smartest tool in the shed, but my ytd is as good or better than many of my precious Saul people. And I do mean precious.
Very grateful slob.
And . . . . thank you Trump 
for creating events that trigger mass buys or sells by the big guys. Tariffs? You can almost hear those rats scurrying over to sell everything. End of the war or oil embargo? “scratch scratch” as the rats scurry back to buy all these volatile positions that Saul et al favor.
It’s these mass swings here these days that make this possible. (did not and will not vote for Trump). I can only lose so much now as compared to the 75% my portfolio dropped in '21 - '22.
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Yes, if I had chosen stocks on my own, certainly I would have less than thrilling results, as I was a newbie. I’m sure way worse than I have done following MF. It would be"my education" as you said. BUT… I did not choose my own stocks. I bought ONLY MF portfolios. It was not me that underperformed, it was MF paid portfolios that underperformed. I’m not shifting the blame, I made the decision to follow MF, that’s on me. What I’m pointing out, is that MF paid portfolios underperformed the market.
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…and they underperformed dramatically. The market was almost four times better
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When David Gardner was still actively participating in the Fool, they would keep a running comparison between his stock picks and Tom’s. David’s numbers crushed Tom’s on Stock Advisor. I would only choose to invest on the David side, and I did much better than the S and P 500 at the time. I also belonged to the original MF Pro which was an active portfolio that hedged and used options. I learned a ton about options, have made my own trades over the years from that education, and consider that a win.
But I’d still have to agree that one only has to look at the seemingly dozens of portfolios that they are all underwater vs the index, and I think that is to be expected, and why I always appreciated the newsletter style of SA and RB for stock ideas rather than following a portfolio.
I’m only allowed to invest in mutual funds in my retirement account, and use non retirement money for MF/individual stock investing and am lucky to have started early in the dot com rush and persisted and done better than my mutual funds. However, it’s not my skill, it’s my luck as to when I started to invest…
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The S&P 500 is tame compared to what is possible. It is not difficult to beat those numbers. Indexes always include losers. Buy the winners; skip the losers.
My IRA is up 110% over the last 12 months. Heavily into tech stocks and AI.
This should not be surprising. On average, most portfolios - and most investment advisors and most managed stock funds and most retail investors - underperform the market. MF used to be more in the business of telling their customers that. That “the Wise” (as they used to call it back in the day) don’t have any special talent or expertise in picking stocks that ordinary investors lack. Then they got more into the business of selling stock picks, so that kind of went by the wayside.
Which is a short way of saying you’re probably wrong in assuming that as a newbie, you would surely have had way worse results than following TMF. Very few folks have actual ability to pick stocks that outperform the market. You’ll find tons and tons of folks who have past performance that outperforms the market, but no more than you would expect from cherry picking and survivorship effects (folks who start picking stocks publicly that do very well have a financial incentive to keep going, while those who don’t have an incentive to fold up their efforts). Many, and arguably nearly all, people who end up beating the market pver any given time period did so because of choices that are not based on any repeatable skill or talent, and are no more likely to beat the market going forward than any other participant.
TLDR; there’s no reason to think that anyone selling you a portfolio of stock picks or stock advice is going to outperform the market.
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I appreciate everyone’s thoughts here 
The last reply here hits on something fundamental that most subscription services quietly avoid saying. Beating the market consistently is genuinely rare even among professionals, and past outperformance tells you almost nothing about future results. A low-cost index fund removes the decision-making problem entirely and historically outperforms most actively managed approaches over long time horizons. That’s not a knock on MF specifically, it applies to pretty much everyone selling stock picks.
I gotta ask: what is the structure of the TMF recs?
25 years ago, SA n RB offered a list of maybe 10 stocks each, with “highest” at #1.
The potential investment stable was relatively limited… 10-20 total stocks.
The follower went out to her favorite brokerage and bought her shares.
Is the current TMF still a list, and the follower still has to do her own buying?
Or is it a TMF fund, with the follower buying shares in that fund?
ralph
I subscribed to Stock Advisor three years ago and have been thrilled with my results. Overall returns are nearly 100% increase. I have bought most of the monthly recs and now have nearly 50 MF-recommended stocks—13 of which have doubled or tripled. Ironically, my two best returns (MU at 8x and PLTR at 5x) were never recommendations, but I learned about them through MF postings. So I am quite pleased with MF.
No it’s not a fund. Same, they send recs, you buy. But there are many more than 10-20. Hundreds. New stock every other week
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