Motley Fool Stock Advisor vs Rule Breakers: Which One Is Better?

In this article, we’ll examine and compare both stock picking services in depth, including their investment strategy and how they work. We also reveal how well they’ve performed over the years, the cost of the services, and the unique features that each offers investors.

Finally, we’ll also give you some helpful information that may help you in deciding if one of these stock picking services is right for you and tell you how to save up to 67% on your subscription. This article is an addition to our in-depth Motley Fool review

motley fool stock advisor vs motley fool rule breakers

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Motley Fool Stock Advisor vs Rule Breakers: An Overview

Stock investing advisory services can be a big help to investors seeking above average returns on investment. Many stock market investors aren’t satisfied with the average 10% annual return that the S&P 500 has historically generated. So, they’re not interested in putting their money into passive investing index funds. They aim to garner significantly higher returns by actively managing the stocks in their investment portfolio.

Since most stock investors aren’t experts at picking stocks from the thousands of individual equities that are available to invest in, many look to find a good stock picking service for stock recommendations.

Two stock picking services that are among the most popular and the most successful are two offerings from the personal finance and investing website, Motley Fool – https://www.fool.com/ – Motley Fool’s Stock Advisor and Motley Fool’s Rule Breakers. Let’s compare both.

Stock Advisor – The Basics

Let’s first look at Motley Fool’s Stock Advisor. This is a stock picking newsletter service run by two of the three co-founders of Motley Fool, brothers David and Tom Gardner.

The brothers have an experienced team of analysts that helps them scour the stock market for the most promising investments.

Both Tom and David make their picks, offering subscribers on average two new stock recommendations each month. That’s along with a continuously updated list of five portfolio recommendations called best stocks to buy. The stocks are chosen with an investment strategy based on fundamental analysis and a unique approach to stock picking.

Both of the Gardner brothers have solid stock market investing backgrounds. David was formerly a featured writer for Louis Rukeyser’s “Wall Street” stock advisory newsletter. He and Tom have co-authored several widely read books on stock investing, including “The Motley Fool Investment Guide” and “The Motley Fool Million Dollar Portfolio.”

Stock Advisor, which was established in 2002, has more than met the goal of outperforming the S&P 500, with a return on investment of more than 200% over the past five years, 2016 to 2021.

Rule Breakers – The Basics

David Gardner is also the head stock advisor for Motley Fool’s Rule Breakers newsletter. For the Rule Breakers’ stock recommendations, David and his fellow analysts employ a different investment strategy than they do for the Stock Advisor service.

Essentially, they look more for potential high growth stocks, specifically, innovative companies in new, booming industries. But, of course, while such stocks offer investors potentially higher gains, they also come with correspondingly higher risk.

The Rule Breakers newsletter provides a couple of new stock picks each month, along with a periodically updated list of stock picks called “Best Buys.”

In addition, the newsletter also offers beginning investors a stock recommendations list of “Starter Stocks.”

Rule Breakers, which David created in 2004, has provided subscribers with an outstanding five year return of approximately 320%. Like Stock Advisor, about 90% of Rule Breakers stock picks have turned out to be profitable investments.

Both services have also enjoyed returns of 100% or more on nearly one third of their stock picks over the past five years. As might be expected from its more aggressive investment strategy, Rule Breakers has experienced both the largest gains and largest losses on individual stocks.

Motley Fool Rule Breakers vs Stock Advisor: How They Work

Here is how the Motley Fool newsletter services operate:

How Motley Fool Stock Advisor Works

The Motley Fool Stock Advisor team takes a value investing approach in selecting stocks. They recommend stocks that they believe are good “buy and hold” recommendations for long term investors.

But, again, David and Tom have their own individual investment strategies. Tom is more of a classic value investor. He is specifically searching for stocks in less popular market sectors of companies that have solid financial metrics.

David leans more toward identifying little known stocks that he thinks could show investors rapid growth and expansion in the relatively near term. You might say he looks for value stocks that aren’t yet recognized as value stocks.

How Motley Fool Rule Breakers Works

As noted, the investment strategy of the Fool Rule Breakers team is more oriented toward growth investing – trying to identify growth stocks that potentially offer exponential gains for investors.

One of the factors that Rule Breakers focuses on is whether a company has one or more notable competitive advantages in the marketplace, such as a unique product, service, or patent.

Rule Breakers is willing to endure buying a few stocks that don’t pay off or even lose some money in return for the opportunity to cash in on some high growth stocks that provide investors with returns on investment of 100, 200, 300%, or more.

Rule Breakers vs Stock Advisor: Similarities and Differences

Each of these two stock advisor services is unique, but they also have quite a bit in common.

  1. First of all, both are distinctly Motley Fool creations, as the co-founding Gardner brothers operate them.
  2. Second, as already noted, both have consistently met their stated goal of substantially outperforming the overall stock market with their stock picks.
  3. Third, both newsletters have a well-established track record for investors to review, as they’ve been in operation for nearly 20 years.
  4. Rule Breakers and the Stock Advisor newsletter provide an additional stock picks advisory service with a “Starter Stocks” list for novice stock investors.
  5. Finally, both newsletters don’t just provide stock recommendations with no explanation. Instead, the reasoning behind each of their stock picks is always given, thus, providing subscribers with ongoing education in stock market investing.

The primary difference between the two newsletters lies in their basic investment strategy:

The Motley Fool Stock Advisor takes essentially a value investing approach, while Motley Fool Rule Breakers pursues more of a growth investing strategy.

Because of these basic investing strategy differences, the Stock Advisor investment portfolio usually experiences significantly less volatility than the Rule Breakers portfolio does.

The Stock Advisor stock picks are more for the long term. Rule Breakers picks are more likely to be bought and sold over a somewhat shorter timeframe.

Discounts

New subscribers get a massive discount on all annual Motley Fool subscriptions. Below you find the current offers Motley Fool provides.

Service Discounted Price 1st Year Discount Renewal Price 2nd Year
Motley Fool Stock Advisor $89 with this link 55% $199
Motley Fool Rule Breakers $99 with this link 67% $299

Stock Advisor vs Rule Breakers – Which Newsletter is Best for You?

So, Stock Advisor vs Rule Breakers, which of these two newsletters is best suited for you, personally? The answer to that question all depends on your personal finances, investing goal.

It also depends on your basic investment strategy, value investing or growth investing, and which you feel more confident or comfortable with using.

Another key factor that should guide your decision is your level of risk tolerance. As previously noted, the Rule Breakers stock picks have generally been more volatile than the Stock Advisor picks and have featured both the biggest wins and biggest losses.

Therefore, if your risk tolerance is on the lower side, then you’ll probably be more comfortable with using the Stock Advisor service. On the other hand, if you’re an investor who wants to try to get in on the next big explosive stock market winner, like Apple (NASDAQ: AAPL) or Amazon (NASDAQ: AMZN), then you’re likely to be more inclined to favor the Rule Breakers stocks.

Beginning investors may be drawn to Stock Advisor, thanks to its helpful list of starter stocks, lower recurring prices and more extended history of managed trades.

Alternatives to Stock Advisor and Rule Breakers

Motley Fool offers alternative stock advisory services if neither the Stock Advisor nor the Rule Breakers newsletter suits your fancy. Among its many offerings are the following:

  • The Everlasting Stocks newsletter is a newer service offered by brother Tom that features 15 stock market picks from Tom’s own investment portfolio. Subscribers also get the use of a proprietary portfolio allocation tool.
  • The Rule Your Retirement newsletter, as the title indicates, is focused on financial planning and investments for retirement planning. It includes asset allocation guidance, estate planning and insurance information, and Social Security tips, along with mutual fund and ETF investment recommendations. This newsletter is an excellent source of information for your overall, long term financial planning. Click here to join
  • Motley Fool Options is an investment advisory service that’s focused on option investing. Along with specific recommendations, the service also provides an in-depth education in option investing.
Service Discounted Price 1st Year Discount Renewal Price 2nd Year
Motley Fool Stock Advisor $89 with this link 55% $199
Motley Fool Rule Breakers $99 with this link 67% $299
Motley Fool Everlasting Stocks $99 with this link 67% $299
Motley Fool Rule Your Retirement $74.5 with this link 50% $149
Motley Fool Options Not Available

The Motley Fool website also offers a number of other investing advisory services that you may want to check out on your own.

Conclusion

Creating a high-performing stock portfolio on your own requires a lot of knowledge, a lot of investment research, and, therefore, a lot of time. Most people approach the stock market without in-depth knowledge on stock investing, and without the time to acquire such an education.

A good stock advisory service run by seasoned professionals and successful stock investors can be an extremely helpful tool. The Motley Fool is a well-established and well-respected stock market information and advice website that offers investors two stock advisory newsletters that both have outstanding track records.

If you’re looking for stock recommendations, the Motley Fool Stock Advisor and Motley Fool Rulebreakers are two services that are both worth a look.

About the author: Alexander is the founder of daytradingz.com and has 20 years of experience in the financial markets. He aims to make trading and investing easy to understand for everybody, and has been quoted on Benzinga, Business Insider and GOBankingRates.