[NA]Motley Fool

All I typically see from them are crappy articles but then again I'm a crappy investor so don't listen to me!
 
They have a few books that are ok, but nothing you can't find elsewhere. Years ago thought about subscribing but research showed it wasn't worth it. Sorry 9HB forget why.
 
It’s a 3rd rate site in my opinion. If you trade regularly, look into Action Alerts Plus from Jim Cramer. Much better!

I even like Zacks better than MF, but that’s just my preference.

Most trading platforms have their own research tools, so I don’t use a lot of the generic stuff on the web that often anymore.
 
Motley Fool is a tiny player in an industry based on the false premise that investors can make money by stock picking or by hiring stock pickers. They do, on their web site, more or less the same thing casinos do -- try to convince people that they can beat the odds.

Here is the fundamental paper on stock picking: https://web.stanford.edu/~wfsharpe/art/active/active.htm It is only three pages and well worth studying.

S&P's "SPIVA Report Card" comes out every six months and documents the abysmal results of stock picking: http://us.spindices.com/documents/spiva/spiva-india-mid-year-2017.pdf?force_download=true

S&P's "Manager Persistence Report Card" also comes out every six months and documents the fact that stock-pickers' successes are statistically indistinguishable from random luck: http://us.spindices.com/documents/spiva/persistence-scorecard-june-2017.pdf?force_download=true

I was talking to a TDAmeritrade manager a week or so ago. (TDAmeritrade caters especially to amateur traders.) I asked her what their average trader's return was. She said it was 1.5%. Actually, I am sure it is below zero because the 1.5% number does not count the traders who failed so badly that they gave up and thus are not in the statistics. This is called survivorship bias.

Here is what a true (Nobel prize-winning) guru has to say:

You might also enjoy these brief guru videos:
https://famafrench.dimensional.com/videos/is-this-a-good-time-for-active-investing.aspx
https://famafrench.dimensional.com/videos/identifying-superior-managers.aspx

You will see lots of bragging-type forum posts from guys who have made money picking stocks. GIven the noisy nature of markets, it is definitely possible to do this due to pure luck. Just like the casino billboards showing suckers (err ... customers) holding big checks, the lucky traders are not representative. Do you expect the losers to be posting?
 
Anyone read "A Random Walk Down Wall Street" lately? It's been at least 20 yrs for me.
 
airdale said:
You will see lots of bragging-type forum posts from guys who have made money picking stocks. GIven the noisy nature of markets, it is definitely possible to do this due to pure luck. Just like the casino billboards showing suckers (err ... customers) holding big checks, the lucky traders are not representative. Do you expect the losers to be posting?
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Although there are strategies for scouting stock picks. You’re right, it’s mostly a gamblers game. I don’t condone trying to day trade, but I do periodically. I use StreetSmart Edge from Schwab, which provides many analytics to find volatile stocks to “try” and day trade. Big Gap Ups, % Change since Open and most Volume are a few criteria I’ll look for, but then again, trying to day trade is not a good strategy. Most inexperienced folks risk too much of their portfolio or will scalp the stock to make a small profit. Bad idea and not recommended. Buy the dip has always been one of my main strategies.
 
Matthew said:
Anyone read "A Random Walk Down Wall Street" lately? It's been at least 20 yrs for me.
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Yup. It's worth re-reading every once in a while. Malkiel has kept it up (and his income up) with periodic revisions. At Amazon it looks like the most current edition is January 2016.

Another good book is "Winning the Loser's Game" by Charles Ellis.

One that I discovered recently is "The Coffee House Investor" by Bill Schultheis. I've been recommending it to relative novice investors. His web site has excerpts: http://www.coffeehouseinvestor.com/ What other investment book have you seen that includes a recipe for pumpkin pie and little parables illustrated by winter camping experiences on Denali?
 
I never did get into listening or reading any of the huckster type material. A lot of stock picking (at least for me anyways) is just being aware of your surroundings and knowing the business cycles. I've always bought stocks in companies that I use their products, or that I'm familiar with. When oil was at an all time high, I bought airline and refinery stocks. I own Apple computers, so naturally I own Apple stock. As an offshoot of the computer market I own stock in hard drive and graphic card companies. When Bush was president, I bought gun stocks and held them through the Obama era. I like to listen to XM/Sirius radio, so I bought their stock. When Garmin came out with the first handheld GPS, I bought a couple E-maps and some stock in that company. I also play the futures and will regularly buy RBOB options when gas is at it's lowest in the winter and sell when gas is at it's highest in the summer. Same goes for the oil/cattle/grain markets. Wars, droughts, flooding, or freezes effect those markets, so you try to keep in tune with the weather/climate/politics and trade appropriately. I also like to play the VIX as that's kind of a no-brainer and goes along with the "fear or complacency" of the overall markets in general.
 
azblackbird said:
I never did get into listening or reading any of the huckster type material. A lot of stock picking (at least for me anyways) is just being aware of your surroundings and knowing the business cycles. I've always bought stocks in companies that I use their products, or that I'm familiar with. When oil was at an all time high, I bought airline and refinery stocks. I own Apple computers, so naturally I own Apple stock. As an offshoot of the computer market I own stock in hard drive and graphic card companies. When Bush was president, I bought gun stocks and held them through the Obama era. I like to listen to XM/Sirius radio, so I bought their stock. When Garmin came out with the first handheld GPS, I bought a couple E-maps and some stock in that company. I also play the futures and will regularly buy RBOB options when gas is at it's lowest in the winter and sell when gas is at it's highest in the summer. Same goes for the oil/cattle/grain markets. Wars, droughts, flooding, or freezes effect those markets, so you try to keep in tune with the weather/climate/politics and trade appropriately. I also like to play the VIX as that's kind of a no-brainer and goes along with the "fear or complacency" of the overall markets in general.
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Agreed, that kind of thing can be lots of fun. BTDT. The problem is that as individual traders we don't have any information that everyone else doesn't also have and most professionals get it much faster than we do. So if the market price established by thousands of traders reflects all available information (efficient market hypothesis) then we are just rolling the dice on future events. Worse ("Your Money and Your Brain" by Jason Zweig) we are wired to remember our wins and forget our losses. This keeps us sitting at the table.

Have you calculated your total return over the period you've been doing this? How does it compare to the US stock market total return (price change plus interest and dividends)? For reference, last year's total return was 14-15% depending on what index you look at.
 
I'm no expert, but as a general measure, if you've lost money overall since about 2011 or so, you should definitely get a money manager of some sort.

Motley Fool has had some good picks, like everyone else. My CPA swore by them, and is comfortably retired, but not rich...and also at age 65, so....
Me? I probably put the Fool in Motley Fool.

With all the corruption, it's mostly just a big casino for the amateur investor.
If you are part of the corruption, you'll make millions, maybe get caught, then apologize, then get a golden parachute so you can start all over and laugh about it on your yacht.
 
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azblackbird said:
When oil was at an all time high, I bought airline and refinery stocks.
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Strange time to buy those two sectors. Both usually sell off when oil rally’s. Curious what the strategy was in that trade?
 
I am a prolific reader, Motley Fool is not something I spend any time on. I took over running my own account when my broker was quoting me things I had read about in the morning newspaper. I have had my ups and downs, but the bottom line for me is that it is my own money, and I have no one to look to for the performance of my portfolio. That being said, I tend to read blogs of selected writers such as:

http://ritholtz.com/
http://thereformedbroker.com/ both from the same firm
They also advocate something called "Evidence Based Investing" which I am trying to integrate into my methodology.

http://traderfeed.blogspot.ca/ mostly about the psychology of trading/investing
http://dashofinsight.com/ to cover the week ahead, and review the week just past

None of these sites recommend stocks, only give feedback on how to work with your "wetware" to look at your investment style.

azblackbird said:
I also like to play the VIX as that's kind of a no-brainer and goes along with the "fear or complacency" of the overall markets in general.
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Interesting...do you have a view/position on for the VIX right now?
 
airdale said:
Have you calculated your total return over the period you've been doing this?
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Over the last 30 years, the majority of the stocks in my portfolio have been 10-bangers or better. Don't get me wrong, I've picked my share of losers also (mostly speculative plays) and have dumped many a stock once they've reached my threshold. I try to stay as diversified as possible. If something's down, usually something else is up. Overall I'm way ahead. I'm a long term investor when it comes to stocks. The only speculation I do is in the commodities markets, and they're usually pretty simple if you understand the cycles.
 
Ryanb said:
Strange time to buy those two sectors. Both usually sell off when oil rally’s. Curious what the strategy was in that trade?
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What's the largest expenditure for an airline? Same goes for a refinery. I try to buy when everybody is selling and sell when everybody is buying.

eaglepilot said:
Interesting...do you have a view/position on for the VIX right now?
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Right now it's way too complacent, so I'm not playing. Wait for an upsetting event (or the rumor of one) to happen that panics the market and then buy or option SVXY. Last time I played was when all the UK Euro BS was going on. I knew it was going to be a non-event so I loaded up and made some good money. I just recently dumped it.
 
If anyone is interested I have 150 shares of WorldCom and a hundred of ValuJet I'll sell, cheap.

Yeah sticking to Index funds. :)
 
azblackbird said:
... I try to buy when everybody is selling and sell when everybody is buying. ...
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Nothing personal, but I'll pick on this a little bit. First, shares sold always equal shares bought. So there is no case where "everybody is selling" or "everybody is buying." When prices are going down, it is because professional traders are not optimistic about a stock. When prices are gong up, professional traders are optimistic about a stock. It's also important to know that the person on the other side of any amateur's trade is very likely to be a professional (95% of trades, I have read).

So for the OP, when someone says something like " ... that's kind of a no-brainer ..." that is really saying that the speaker believes himself to be smarter than all of the thousands of professional traders out there who have collectively established the current market price. Similarly, to say " ... commodities markets, and they're usually pretty simple if you understand the cycles ..." is to say that the speaker knows more than all of the thousands of professional commodity traders. Both these things can be true, of course, but both seem very unlikely to me.

There is yet another good book out there: "Fooled by Randomness" by Nassim Taleb. His main theme is situations where someone has gotten lucky and, from that, concluded that he is a genius. Again, apologies to @azblackbird; nothing personal intended. (Taleb can be kind of a lunatic, but he's always an insightful author. See also "The Black Swan.")

For reference, the US market (Russell 3000) is up by almost 15 times (502 to 7,339)over the last 30 years ending June 30. That's a CAGR of abut 9.5%. (https://fred.stlouisfed.org/series/RU3000TR) It will be the very rare amateur (or professional!) trader that has even come close to equaling these numbers.
 
airdale said:
When prices are going down, it is because professional traders are not optimistic about a stock. When prices are gong up, professional traders are optimistic about a stock.
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Exactly! Thus my reasoning for buying when everybody is selling, and selling when everybody is buying. Take for instance the airline and refinery stocks. The "professionals" were dumping them left and right because of the high oil prices and the impending market crash as those companies were not showing any profits and likely wouldn't be for quite a long while. So I started loading up on them. I knew that there are only a handful of airlines and that the major ones (at least here domestically) were not going to go anywhere soon. Worst case scenario the government bails them out. Same goes for the refineries. There are only so many refineries here in the US and those that have long been established are not going anywhere. Our national security depends on it. So I made those plays and have done quite well.

You have to remember something. Most "professionals" are traders... not investors! That's why so many have such poor track records. I always look for the long term plays (except if I'm speculating) and invest accordingly. That strategy has done me alright so far. ;)
 
I was a long time subscriber to Motley Fool Stock Advisor. I will say that timing is everything. If you get in and get out exactly when the MF advisors do, you'll make a killing. However, if you're like me, and buying on their recommendations, you'll be too late. Also, you can't possible buy the whole spread. And, even as good as they are overall, they still have a few stinkers. And, for an individual investor, like me, one or two stinkers can sink a whole portfolio.

I'm in a few index funds, mostly ETFs. I'm up just over 10% year-to-date. Not impressive. But, not bad either.
 
Best advice I ever received about the stock market is: never buy the bottom or sell the top. This strategy makes you go broke!

Most retail traders lose their accounts in 90 Days, thus, big houses just short your longs or long your shorts. It’s easy money for them.
 
Vanguard funds. Love 'em. Jack Bogle rules.
 
jmp470 said:
Best advice I ever received about the stock market is: never buy the bottom or sell the top. This strategy makes you go broke!
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Actually, it would be a dynamite strategy. If you could do it. The problem is that no one knows how to call bottoms or tops.

John Bogle: "The idea that a bell rings to signal when investors should get into or out of the market is simply not credible. After nearly 50 years in this business, I do not know of anybody who has done it successfully and consistently."

John Kenneth Galbraith: "There are two kinds of forecasters: those who don't know, and those who don't know they don't know."​

jmp470 said:
Most retail traders lose their accounts in 90 Days ..
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Sorry. False.

jmp470 said:
big houses just short your longs or long your shorts. It’s easy money for them.
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Sorry again. It is extremely unlikely that anyone on this board is making trades that are large enough to even slightly interest the front-runners. (http://www.investopedia.com/terms/f/frontrunning.asp) They are lying in wait for the big mutual funds to trade tens or hundreds of $millions and for large index reconstitution events.
 
I use Louis Navellier's Blue Chip growth news letter for some of my picks, and he is doing quite well. AVGO up 251.07% Since bought in June 2014. WB up 127.18% in approx. 7 months. A few losers, but a lot of winners. FWIW. Probably all change when Rocket man launches his next missle .
 
N659HB said:
Anyone here subscribe? Worth it?
I signed up for a one month trial.
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Years ago they were really cool. Great advice and worth the sign up. Now just money grubbers with clickbait ads everywhere and all sorts of subs leaching off their name. Really disgusting any more....
 
Thanks everyone for the insights. The lure that got me to bite had to do with AI being the next biggest thing. Every aspect of our lives will be touched by AI, yada yada yada. It turns out they were recommending stock in a company that makes gaming video chips (not an AI company!), the premise being AI systems will use such image processors to scan billions of images for common patterns.

Hmmmm. Perhaps I had had one too many drinks that night. They did offer a money back guarantee, so I'll probably take them up on it, and not play the fool.

I've been putting money into our company's 401k over the past 5 years, which has had lackluster performance until this year. So far this year the return has been just over 9%. Should be over 10% by year end.
 
The best/easiest investment advice I ever got was from a site called F**ked Company. It was ran by a guy named Pud. He allowed postings from disgruntled employees of many of the current dotcom companies at the time. For awhile it was like shooting fish in a barrel. All you had to do was go to his site, read the many postings, put in your short orders, and then sit back and watch the stocks plummet. It was pretty awesome until many of the companies started catching on, and then started suing him for defamation and whatever else they could think of.

I miss those good 'ole days... :cool:
 
N659HB said:
Thanks everyone for the insights. The lure that got me to bite had to do with AI being the next biggest thing. Every aspect of our lives will be touched by AI, yada yada yada. It turns out they were recommending stock in a company that makes gaming video chips (not an AI company!), the premise being AI systems will use such image processors to scan billions of images for common patterns.

Hmmmm. Perhaps I had had one too many drinks that night. They did offer a money back guarantee, so I'll probably take them up on it, and not play the fool.

I've been putting money into our company's 401k over the past 5 years, which has had lackluster performance until this year. So far this year the return has been just over 9%. Should be over 10% by year end.
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1) in this market, everyone better be getting 8~9% YTD or they're failing.

2) Most company 401k's have a range of investment options. Though some provide incentives for putting some of that money into company stock. Don't let the company HR bubba choose your investments for you. There are several horror stories about employees to putting all their retirement savings into their employer's stock with disastrous results. Fidelity, and several other name-brand retirement savings plan managers have automated investment advisory apps that can help you decide on which of the plan's 401k investment options are best for you. Don't trust anyone who says they know the best way for you to invest. If they did, they wouldn't be working so hard to give you advice.
 
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If you want to make money in the markets but not play in the markets, buy index funds (preferably from Vanguard or similar no load, low expense index funds) and hold them. Data from multiple credible studies proves that even the best actively managed mutual funds WILL NOT beat the indexes over time. If time is shorter (i.e. approaching retirement) then perhaps an active strategy makes more sense, but that all depends on your financial situation and your personal goals.

If you have some extra cash and want to play in the markets, you better have an intimate knowledge of what you’re doing unless you like to lose money. If you’re relying on Fool or Cramer or similar media celebrities to pick your stocks, you’re probably better of in a mutual fund.

As to company 401k plans, most of the ones I’ve seen lately have been lackluster. My last company put everything in a target date fund which I could not change; the only reason I contributed was to get the company match. My current company doesn’t match, so I pay the taxes now and put that money in a brokerage account instead. That may or may not be the best answer for everyone.

Just my opinion.


JKG
 
JGoodish said:
As to company 401k plans, most of the ones I’ve seen lately have been lackluster. My last company put everything in a target date fund which I could not change; the only reason I contributed was to get the company match. My current company doesn’t match, so I pay the taxes now and put that money in a brokerage account instead. That may or may not be the best answer for everyone.
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Something to consider...

If your 401k plan allows post tax contributions, AND your company allows in-service withdrawals, you might want to consider contributing to the 401k post tax, then rolling it directly into a Roth. Even if your company won't allow the in-service withdrawals, you can still roll it into the Roth after you leave. You may have to pay tax on the gains though.

This is something new that came out just a few years ago.
 
Update: they are now putting the hard sell on me to upgrade to "Supernova" status, or whatever, for the low low price of $2k. Unreal. I have less than 24 hours to decide! :eek:

They also claim to have over 200,000 subscribers. Unreal.
 
JGoodish said:
If you want to make money in the markets but not play in the markets, buy index funds (preferably from Vanguard or similar no load, low expense index funds) and hold them. Data from multiple credible studies proves that even the best actively managed mutual funds WILL NOT beat the indexes over time. If time is shorter (i.e. approaching retirement) then perhaps an active strategy makes more sense, but that all depends on your financial situation and your personal goals.

If you have some extra cash and want to play in the markets, you better have an intimate knowledge of what you’re doing unless you like to lose money. If you’re relying on Fool or Cramer or similar media celebrities to pick your stocks, you’re probably better of in a mutual fund.

As to company 401k plans, most of the ones I’ve seen lately have been lackluster. My last company put everything in a target date fund which I could not change; the only reason I contributed was to get the company match. My current company doesn’t match, so I pay the taxes now and put that money in a brokerage account instead. That may or may not be the best answer for everyone.

Just my opinion.


JKG
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I looked into Vanguard years ago. Perhaps I should again as well. We are supposed to be able to customize our 401k, but that may be limited to percentages of what's offered, i.e. pre-selected high-risk, medium risk and low risk investments.
 
N659HB said:
... They also claim to have over 200,000 subscribers. Unreal.
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Not at all. There's a sucker born every minute.

Re indexing, as a general strategy that's definitely the way to go. But be aware that the more accurate term is "passive investing" and the strategy is basically to own all asset classes. This means a total world stock fund like Vanguard Total World Stock Index Fund (VTWSX), or a blend of a total US market fund and a total international/non-US fund. The latter allows some home country bias, about which you can find lots of discussion on the internet.

A lot of what is called "indexing" these days is really trying to pick winning sectors. For example, buying only an S&P 500 index is to place a single bet on large cap US stocks. These are only about 40% of the world market. They've been doing well lately, but every dog has his day. A passive investor will also be exposed to US small, growth, and value stock and to similar non-US sectors in both developed countries and emerging economies. With this kind of diversification, the historical data says that you will outperform all but a tiny single-digit percentage of professional stock pickers over the long term. Then the rest of the story is that there is no way to identify the winners ahead of time. So passive is the winning strategy.
 
airdale said:
So passive is the winning strategy.
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What? A few posts up your were poo-pooing me for being smarter than the so-called "professionals" by being well diversified, knowing how to play the charts and cycles, and adopting a buy and hold strategy. What gives? :dunno:

Just yanking your chain... ;)
 
azblackbird said:
What? A few posts up your were poo-pooing me for being smarter than the so-called "professionals" by being well diversified, knowing how to play the charts and cycles, and adopting a buy and hold strategy. What gives? :dunno:

Just yanking your chain... ;)
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OK, no harm, no foul. I was picking on you for implying that you were smarter than the market. "charts and cycles" type stuff, which I equate to reading entrails. Diversification, basically buying everything, and holding it is the statistically sound strategy. Buffet, when asked what the ideal stock holding period was, answered "Forever."

I ran across another great Buffetism a few days ago: "The market is a machine for transferring money from the impatient to the patient."
 
airdale said:
Actually, it would be a dynamite strategy. If you could do it. The problem is that no one knows how to call bottoms or tops.

John Bogle: "The idea that a bell rings to signal when investors should get into or out of the market is simply not credible. After nearly 50 years in this business, I do not know of anybody who has done it successfully and consistently."

John Kenneth Galbraith: "There are two kinds of forecasters: those who don't know, and those who don't know they don't know."​

Sorry. False.

Sorry again. It is extremely unlikely that anyone on this board is making trades that are large enough to even slightly interest the front-runners. (http://www.investopedia.com/terms/f/frontrunning.asp) They are lying in wait for the big mutual funds to trade tens or hundreds of $millions and for large index reconstitution events.
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What you have listed is against SEC regulations, front running. What I’m talking about is your bank taking the opposite of your trade.

Investment firms and banks are allowed to trade the market. And the market is designed to take money from retail investors.
 
jmp470 said:
What you have listed is against SEC regulations, front running. What I’m talking about is your bank taking the opposite of your trade.

Investment firms and banks are allowed to trade the market. And the market is designed to take money from retail investors.
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Believe whatever you like.
 
Ryanb said:
Strange time to buy those two sectors. Both usually sell off when oil rally’s. Curious what the strategy was in that trade?
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That's the point. The market seemed to think oil was going to go to $200/bbl and that the entire airline industry would be out of business. I bought a couple airline stocks when they were in the $2.00 range. The same ones are now in the $50-60 range. Of course, Motley Fool had negative article after negative airline on airlines during this timeframe. They've recently changed their tune.
 
airdale said:
OK, no harm, no foul. I was picking on you for implying that you were smarter than the market. "charts and cycles" type stuff, which I equate to reading entrails.
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Years ago a programming buddy (who was a staunch commodities trader) and I spent a couple months and wrote some algos based on historical charts/cycles/weather/political patterns etc. of the commodities that we liked to trade the most. His favorites were coffee, corn, and OJ. My favorites were oil, cattle, and fuel. Let’s just say we’ve been fairly accurate over the years.

If you don’t think for one minute that the “professionals” don’t do the very same thing... then I’ve got a bridge to sell you. We don’t even mess with stocks. Way too many houses running their own algos and machines which are located right on the hubs of the major trading networks. I don’t have the millions of $$$ required to play that game just to shave a few milliseconds off of my trades. That’s why I’m a long term investor, and not a short term “professional trader” when it comes to stocks. I can't beat the algos.
 
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