Major Changes at Special Ops and Million Dollar Portfolio! 5.00/5 (100.00%) 3 votes

Over the course of the last few weeks, big changes have taken place at two of Motley Fool’s subscription services, Special Ops and Million Dollar Portfolio. In both cases, senior advisors were replaced, the analyst teams reconfigured, and the investment strategies re-focused.

I have not written a lot about either one of these services on this site because they never distinguished themselves as worth covering, to be honest.

Special Ops: ‘Special’ like the Titanic

In the case of Special Ops, which focused on special situations like turn around plays, and in companies that were in theory completely misunderstood and undervalued by the market, their performance was abysmal. In February 2014 I even put them on a “death watch” as their performance seemed to get worse with every single month. The idea behind special ops investing is not unlike what a private equity firm or hedge fund does: find companies that are completely undervalued or misunderstood by the market, invest in them, and then wait for the catalyst (such as a spin off for example) to occur, and then reap big returns in theory. These types of investments can take a while to play out, and results tend to be very hit or miss. When they work out they tend to work out really well, but when they don’t… well you end up with performance like you saw in Special Ops.

So in early December it was announced that Tom Jacobs, the senior advisor of Special Ops was out. Not a lot of detail in the announcement but he was wished “the best of success” and subsequent discussions on the boards made it clear it was not a voluntary move. He was replaced by Jim Gillies, one of the advisors from Motley Fool Options. Jim Royal, the other advisor for Special Ops remains with the service. They immediately sold off most of their existing positions, and have stated that their focus going forward will be purely on “special situations”. There will be very limited options investing, and no shorting or hedging. From their FAQ:

Our focus will be primarily spinoffs and thrift conversions, with activist investor plays, jockey plays, Pay Dirt-type value, and options being secondary (but still important) strategies.

More importantly, they no longer claim they will outperform in market downturns. That used to be one of the selling points of the service: Want a way to make money in a bad market? Buy these Special Situation investments that aren’t correlated to the markets and you’ll make money when the market turns south, in theory. Now they are emphasizing “performance over the long term”, and the concept of “accuracy”, meaning that if you made money on an investment, that’s a win, and over the long run, a high accuracy rate will lead to outperformance. That seems to be an approach Jim Gillies is borrowing from his Options service where they measure their performance the same way.

I’ve been using the phrase “in theory” a lot in talking about Special Ops and I think that’s the problem with this type of investing. In theory these severely undervalued or misunderstood investments will one day unlock their value and you’ll make a lot of money. The problem is that hedge funds and private equity firms have armies of high paid analysts searching for the same opportunities. I don’t think the Motley Fool can consistently compete with those types of resources on this playing field where it’s not about long term, buy and hold investing, where you can beat the hedge funds just by holding on longer. This is about identifying the opportunities early and getting in on the investments before every one else catches on. How many times can Motley Fool do that – enough to produce that long term accuracy they are now focusing on? I’m not convinced they can.

Cleaning house and refocusing the strategy was a necessity as it was clearly not working at all. But I wonder if this new approach will just be a case of rearranging the deck chairs on the Titanic.

Million Dollar Portfolio: So Much Potential, So Little Execution

Million Dollar Portfoiio is also undergoing sweeping changes, and unlike Special Ops, I think this really could be a rebirth of a service that always seemed to have a lot of potential, but whose performance and execution just never followed through.

MDP’s strategy was to make recommendations from across the other Motley Fool recommendation services (i.e. Stock Advisor, Inside Value, Hidden Gems, etc.). It was a real money portfolio ($1 million dollars) and the idea was it would be the best of the best from across the Motley Fool universe. Well the performance never panned out, and without that I never really saw what the service offered to make it stand out against the other portfolio services like Supernova and Pro.

Seems I wasn’t the only one who felt that way. Ron Gross, the senior advisor of MDP, is now out of that role, replaced by Matt Argersinger, the lead advisor from Supernova Odyssey. Gross is moving into an “emeritus” position at MDP where he will be focused on “educational content” and take on a wider role across Motley Fool in their value-oriented services. This move makes a lot of sense to me – one of the things I like about MDP was some of their content on portfolio building and valuation – so if we’ll be getting more of that from Ron in this new role, it should be a good thing. And Matt has done a really good job so far with Supernova Odyssey, so I will be very interested to see what he can do with an even wider universe of stocks from which to pull.

They’ve currently put the entire portfolio on hold and in the next week or so will be selling and reallocating positions – they’ve indicated it won’t be the complete gutting that happened with Special Ops but more of a surgical approach.

And they will also be refocusing their strategy as well. Now the portfolio will be based solely on stocks from the recommendation services that are either Core/Buy First stocks in those services or current Best Buys. They’ll publish a Watch List and then pick the stocks to buy from that Watch List within 30 days.

I will be keeping a closer eye on MDP now as I think these moves could reinvigorate the service. The combination of Ron’s content with Matt’s portfolio management could be a fantastic combination. And as I reevaluate my own use of the Motley Fool One services, if MDP turns itself around, it could prove to be a much more affordable alternative to MF One that will give me access to all of the recommendation services, which I consider to be the strongest parts of Motley Fool anyway.

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Motley Fool Performance – December 2014

Motley Fool Performance – December 2014 5.00/5 (100.00%) 4 votes

Here are the latest performance stats for all the Motley Fool services, since their inception. Not all of these are available on their public site.

The returns are calculated using the official methodology of each of the services.

Check the Performance category posts on the right to see if more recent stats exist.

If you find these helpful, please take a second to rate the content by clicking on the stars above. You can sign up via email (in the sidebar on the right hand side) to follow my blog and get instant notifications when my monthly performance stats are updated. And follow me on Twitter (@motleyfoolrview).

And of course, leave a comment below and let me know what you think.

Call it a Wrap

2014 comes to a close and it was a tough year for the Motley Fool Services. While the S&P 500 was up +11.8% for the year, and the Russell 2000 was up +3.8%, most of the Motley Fool services lost ground to the S&P. Keep in mind, most are still outperforming the S&P so hard to complain about that, and their absolute gains were mostly up for the year as well. But it was a volatile market this year with significant dips in January and October, particularly for small cap stocks.

The only Portfolio service with a gain vs. the market was Pro, which went from 0% to 1%. Not a glamorous result, but one of the goals of Pro is to minimize volatility in their portfolio, and when compared to the other Motley Fool portfolios, having a 1% gain against the market shows the benefits of Jeff Fisher’s approach in a more volatile year.  MDP on the flip side really took a nose dive, going to a positive +6% to a -6% outperformance. But particularly concerning was Supernova Phoenix’s slip from outperforming by +24% to only +5%. For a portfolio that is supposed to be geared towards retired individuals, that kind of volatility is particularly scary. Let’s see if they can stabilize here.

On the idea-recommendation services side of the scorecard, Inside Value is the only service with a small 2% gain (not discernible in the chart, however). I’ve really started to focus a lot more on Inside Value in my own investing, as I continue to be impressed with their strong, consistent performance. Rule Breakers got close with only a -2% drop in outperformance, while Tom Gardner’s side of Stock Advisor lost nearly one-third of it’s outperformance. Interestingly, David Gardner’s side is the only recommendation service whose absolute returns dropped.

I want to point out that this month a new portfolio service has been added – Phoenix 2. With the original Phoenix portfolio moving into it’s next phase where it won’t be adding any new money, they’ve added Phoenix 2 which is geared toward retirement-aged investors. As of December, they had only made 1 stock recommendation so the performance measurement is still premature.

Hopefully all of you have had a successful investing 2014 and will find even more success in 2015!

Understand Before You Invest

For those of you who are looking for a deeper dive into the performance of the Recommendation Services, I have recently launched a premium product called Performance Insights.  I’ve calculated Success Rates, CAGR’s and Annualized returns for all of the stock recommendations services. If you ever wanted to look into the historical trends of their performance, or performance by industry, or performance by number of years held, you should check these out.  My Motley Fool Performance Insights page has further details and a sample of what you get.

 

MF Performance Stats - 2014-12Dec

 

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Motley Fool Supernova: Truth in Advertising

Motley Fool Supernova: Truth in Advertising 3.40/5 (68.00%) 5 votes

With Supernova opening its membership again recently, the Motley Fool marketing machine is at full blast. One of the charts they’ve included in their marketing materials for Supernova is the following chart, touting their very successful recommendation of Apple.

Source: The Motley Fool

Source: The Motley Fool

Impressive indeed. A great recommendation.

However they did not mention one of their worst performing picks: Westport Innovations, one of the first picks of the Odyssey portfolio. Westport was heavily touted back in early 2012 as one of their top stock recommendations. But it hasn’t faired nearly as well as Apple. So I’ve included my own view of that recommendation history.

Source: Google Finance

Source: Google Finance

 

Motley Fool Marketing must be stopped!

I’m a fan of Motley Fool, and recommend their services in general, but I’ve talked a lot about how spamerrific their marketing is. In fairness to the advisors over at Supernova, they’ve owned up to what a mistake the Westport recommendation turned out to be. And as a whole, the Supernova performance has been pretty strong. But before you sign up for any of their services, including Supernova, make sure you understand the whole story. No investing service is perfect, and every investor will have their share of losses, including some that tank like Westport has.

 

 

in Performance, Supernova

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Motley Fool Performance – November 2014

Motley Fool Performance – November 2014 3.50/5 (70.00%) 6 votes

Here are the latest performance stats for all the Motley Fool services, since their inception. Not all of these are available on their public site.

The returns are calculated using the official methodology of each of the services.

Check the Performance category posts on the right to see if more recent stats exist.

If you find these helpful, please take a second to rate the content by clicking on the stars above. You can sign up via email (in the sidebar on the right hand side) to follow my blog and get instant notifications when my monthly performance stats are updated. And follow me on Twitter (@motleyfoolrview).

And of course, leave a comment below and let me know what you think.

You Tell Me

Each month these performance posts are among my most popular content. This month, with the markets relatively stable, and the Motley Fool performance stats uneventful, I am going to forego my usual commentary, and instead ask you, the readers, to give me your feedback. I want to know how you use the performance information I post each month. Does it influence your investing decisions in any way? Has it influenced whether you subscribe to any Motley Fool services? I’d love to hear anything and everything you have to say, so please, leave a comment and let me know what you think.

 

Understand Before You Invest

For those of you who are looking for a deeper dive into the performance of the Recommendation Services, I have recently launched a premium product called Performance Insights.  I’ve calculated Success Rates, CAGR’s and Annualized returns for all of the stock recommendations services. If you ever wanted to look into the historical trends of their performance, or performance by industry, or performance by number of years held, you should check these out.  My Motley Fool Performance Insights page has further details and a sample of what you get.

And this month, I’m expanding my discount offer to include all my Performance Insights packs. The first 25 loyal readers this month who purchase any of the packs (including my popular Stock Advisor/Rule Breakers combo pack), can get a 30% discount by entering the code mfrloyalty-30 at check out.

Thanks for all your support!

 

 

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Supernova Pricing – December 2014

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Motley Fool Supernova is opening up to new members today. The marketing offer is filled with the usual 100 pages of hyperbolic infomercialism, highlighting some of their best picks (Apple and Netflix), and this time touting the opening of their Phoenix 2 portfolio which will basically replicate the original Phoenix portfolio, now that it is has shifted into its second stage.

If you are considering joining Supernova this time around and have any questions, let me know in the comments. If you want to get a better understanding of Supernova’s performance, check out my free monthly performance posts. For more in-depth analysis on the returns of Rule Breakers and Stock Advisor (on which Supernova portfolios are based), you should consider my premium Performance Insights, where you can get yearly performance results, annual returns and more. It would be a good investment to make before you consider signing up for thousands of dollars.

Pricing

The pricing remains very close to what it was back in February. The one year price has gone up by $100, but the multi-year subscriptions remain the same. And as they have done in the past the are offering a one-month money back guarantee for 1 year subscriptions, and full one-year money back guarantee for any of the multi-year subscriptions.

  • 5 years: $3,999 ($800/year)
  • 3 years: $3,499 ($1,166/year)
  • 2 years: $2,799 ($1,400/year)
  • 1 year: $1,599

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Supernova Is Getting Interesting

Supernova Is Getting Interesting 3.00/5 (60.00%) 3 votes

Supernova bills itself as the portfolio service that is built on the best of David Gardner’s stock picks from Stock Advisor and Rule Breakers. The only problem is that up until now there has not been a lot of actual portfolio management happening. It’s been more about just buying stocks on a regular basis with a dash of allocation guidance thrown in. But both Phoenix and Odyssey have entered new phases where portfolio management is taking on growing importance. And this change might finally make the Supernova service worth its premium price.

Phoenix is entering its second phase as it heads into 2015 where it will no longer be adding new money to the portfolio. Furthermore it will have to make $10,000 in distributions each quarter, mimicking a person in retirement, which has always been its charter. This means it will have to be very careful about its future Buy and Sell choices in order to avoid depleting the portfolio.

Odyssey on the other hand has also found itself in a situation where recapitalization has become necessary. The portfolio will continue to contribute new money on a regular basis, but as the portfolio has grown, each new $1000 investment has amounted to smaller and more allocations, which in turn has made each investment decision less and less impactful. And so they have just undertaken a recapitalization plan where they sold 10% of their holdings in order to make money available for new investments that are bigger than their normal $1000 contributions allows. They will do this rebalancing on an annual basis.

I like both developments. For Phoenix, this moves it into the interesting position of being an investment portfolio where there will be more selling than buying. The real world application here is huge and will require an entirely different type of strategizing than what you will find anywhere else in the Motley fool universe, let alone most other investment services out there. Odyssey is also incorporating a realistic constraint that most investors face: limited funds and the need to make hard calls on which stocks to keep or sell as they look to optimize growth. In their first round of recapitalization they have made some interesting and controversial decisions and the service has benefited from the discussions these moves have generated.

With Supernova opening up to new members in the near future, the service has never been more valuable as it starts to really earn its premium status.

in Supernova

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Happy Thanksgiving!

Happy Thanksgiving! 3.00/5 (60.00%) 2 votes

Just a quick post to wish my readers here in the US a Happy Thanksgiving. I hope all of you are taking a break from your hectic lives and enjoying the day with family, friends, and loved ones. It’s a good day to take our focus off money and investing and appreciate the things in life that are really important. And those things are not stock tickers or dollar signs!

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Motley Fool Performance – October 2014

Motley Fool Performance – October 2014 3.67/5 (73.33%) 3 votes

Here are the latest performance stats for all the Motley Fool services, since their inception. Not all of these are available on their public site.

The returns are calculated using the official methodology of each of the services.

Check the Performance category posts on the right to see if more recent stats exist.

If you find these helpful, please take a second to rate the content by clicking on the stars above. You can sign up via email (in the sidebar on the right hand side) to follow my blog and get instant notifications when my monthly performance stats are updated. And follow me on Twitter (@motleyfoolrview).

And of course, leave a comment below and let me know what you think.

Rule Breakers Rule

October proved to be a good month for stocks in general. With the S&P 500 up 2% and the Russell 2000 up 5%, we regained most of the losses we had in September. How’s that for volatility? The volatility can be tough to handle, but it reminds me not to focus too much on the short term. Of course a 2 month time-span is also an ultra-short period, but if you had over-reacted in September and gotten out of the market (as some people did), you’d have missed out on even the short term move back up. And by the way, the S&P 500 is up 10% YTD so despite the recent bad taste you may have in your mouth, the market has done pretty well.

Last month I mentioned that Rule Breakers was holding up very well, and this month I’m back to highlight that service. Their performance improved 17% month over month, and is up 19% since last November. In fact, Rule Breakers is the only service that is actually up in that one-year timeframe. They are also closing in on their peak mark of +49% performance back in February. Compare that to the Hidden Gems service, which has a similar investing mandate (small companies) which is down 23% YOY. So particularly in a year of small cap volatility, it goes to show that picking quality companies can lead to good performance. And it highlights the value of a service like Rule Breakers, which has the type of advisors who can help you identify those companies.

Understand Before You Invest

For those of you who are looking for a deeper dive into the performance of the Recommendation Services, I have recently launched a premium product called Performance Insights.  I’ve calculated Success Rates, CAGR’s and Annualized returns for all of the stock recommendations services. If you ever wanted to look into the historical trends of their performance, or performance by industry, or performance by number of years held, you should check these out.  My Motley Fool Performance Insights page has further details and a sample of what you get.

And this month, I’m expanding my discount offer to include all my Performance Insights packs. The first 25 loyal readers this month who purchase any of the packs (including my popular Stock Advisor/Rule Breakers combo pack), can get a 30% discount by entering the code mfrloyalty-30 at check out.

Thanks for all your support!

 

Motley Fool Performance - October 2014

 

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Motley Fool Performance – September 2014

Motley Fool Performance – September 2014 3.70/5 (74.00%) 20 votes

Here are the latest performance stats for all the Motley Fool services, since their inception. Not all of these are available on their public site.

The calculations follow the official methodology used by each of the services.

Check the Performance category posts on the right to see if more recent stats exist.

If you find these helpful, please take a second to rate the content by clicking on the stars above. You can sign up via email (in the sidebar on the right hand side) to follow my blog and get instant notifications when my monthly performance stats are updated. And follow me on Twitter (@motleyfoolrview).

And of course, leave a comment below and let me know what you think.

Winter is Coming

I’m not a huge Game of Thrones fan, but I’ve seen enough shows to know of their oft-repeated quote “Winter is coming” which is used by the characters as a harbinger of bad things to come. And despite the unseasonably mild weather here in the Northeast, as we wrapped up a September in which the Russell 2000 was down 6.1% and the S&P was down 1.53%, I can’t seem to shake that quote from my mind. I’ve been fairly optimistic up until now thinking the market correction that pundits have been predicting for the last 18 months (at least) might not come until at least next year, and even though I maintain my belief that we are in the midst of a long-term bull cycle that will last for many years, I am starting to wonder if that correction might hit us before the end of 2014.

How does that impact my investing? I’m being a lot more selective and focusing on “value” stocks. So I’ve been looking very closely at Inside Value’s recent recommendations. I’m also accumulating some more cash in hopes of taking advantage of the drop I think is coming. Some of that cash has come from selling a couple positions that I think are fully valued for the moment, and per my strategy post on when to sell a stock, I’ve taken the rest of that cash and put it towards my short-term savings goals.

Speaking of Inside Value, it is the only service that actually gained slightly in September, and is basically flat across the last 12 months. But that is what you might expect from a value-oriented service. Interestingly, Rule Breakers, which is the opposite type of service with a focus on growth stocks, has actually held up pretty well over the last 12 months, down only 3% in that timeframe, but up nicely from its low back in April.

And One More Thing…

I have just launched a new premium product – Performance Insights. For those of you who have wanted more detailed performance metrics for the Motley Fool services, you’ll really want to check this out. I’ve compiled Success Rates, CAGR’s and Annualized returns for all of the stock recommendations services, including median performance, and performance by number of years held. And I’ve broken it out by year and even sector! For full details, and a sample of the Performance Insights, look here.

And for the first 25 loyal readers this month who want to purchase the Stock Advisor pack which breaks out the performance of both the Tom and David Gardner recommendations, click through here to receive 20% off! But again, that’s only for the first 25 people, so please don’t wait too long!

Thanks for all your support!

 

MF Performance Stats - 2014-09Sep

Click the Image to Enlarge

 

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Motley Fool Stock Advisor Deal: $98 for 2 years!

Motley Fool Stock Advisor Deal: $98 for 2 years! 5.00/5 (100.00%) 4 votes

Motley Fool is running a special promotion for their Stock Advisor service, offering a 2 year subscription for $98. It comes with a 30 day, money back guarantee as well.

Compared to their normally advertised price of $199/year, this represents a huge savings.

And if you want to go beyond the high level, hand-picked, performance results in their marketing and really understand how Stock Advisor performs, take a look at my Performance Insights packs. They will tell you the annualized returns, compounded annual returns, performance by year, by industry, and many other useful metrics.

And in tandem with this fantastic deal for Stock Advisor, I’m offering the first 20 people who read this post a chance to get my Stock Advisor Performance Insights for 15% off!

Just click through this link to get the information you need before you subscribe!

in Stock Advisor

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