There are lots of stock picking services available. Most of them focus on the U.S. market; in fact, many of them behave as if the New York Stock Exchange and Nasdaq are the only exchanges on the planet.
While those services are certainly useful for U.S.-based investors, most are not beneficial for people who live in other countries or who want to take a more global view of investing.
The key question to ask when you’re shopping around for a stock picking service is:
What does this service do better than everyone else? Does it provide anything new or different?
The Motley Fool Canada Stock Advisor is a stock picking service designed specifically for investors in Canada. It has a lot in common with the U.S. version but also offers Toronto Stock Exchange picks.
If you’re in Canada, you might be considering the Motley Fool. If you’re asking yourself whether it’s worth the price, here’s our Motley Fool Canada Stock Advisor review.
What Is Motley Fool Canada?
The Motley Fool is an American company that was founded in 1993 by brothers Tom and David Gardner. Their mission was to create a service that would empower individual investors to make smarter investment choices and earn more money. The Motley Fool Stock Advisor is their flagship product.
In 2012, they expanded their services into Canada.
The main difference between Stock Advisor and Stock Advisor Canada is the monthly picks provided. The Canadian service offers subscribers 2 stock picks every month, one each from the TSX and one from the U.S. markets.
The U.S. Motley Fool services also offer 2 picks per month but both are from the U.S. markets. The U.S. version of Stock Advisor doesn’t provide any investment advice for the Toronto Stock Exchange (TSX).
Let’s be clear on the Motley Fool’s picks and how they’re supposed to work. Their investing philosophy is based on a buy and hold strategy. That means buying stock and holding for a minimum of five years.
Here’s a quick summary of their performance since we have been tracking them the last 8 years, broken down by their TSX stock picks, their US stock picks, and their combined performances:
As you can see, in total 69% of their 196 stock picks since 2016 are profitable and they are beating the market by an average of 36.9%. Their picks are beating the market every year but 2021 when the markets struggled with COVID.
The Motley Fool wants you to plan on holding their stocks for at least 5 years, and as you can see the longer you hold them the better they do. Their 2016 picks are up 234% which means that those 24 picks on average more than tripled!
Unfortunately, they did picks Silicon Valley Bank in 2022, that is the stock that they lost 100% on.
But that doesn’t matter to you now as those are in the past. So how are they doing lately?
On the TSX, their December 13, 2023 pick of Lumine Group (TSX:LMN) is already up 59% and their August 9, 2023 pick of TerraVest Ind (TSX:TVK) is already up 55%.
On the US side, their October 25, 2023 pick of Interactive Broker (NDQ:IBKR) is already up 36% and their April pick of CostCo is up 51%.
Day traders and investors with a short to medium investing horizon aren’t their target audience. You could try day trading with the Motley Fool, but… why would you? There are other services that are designed for that.
The Motley Fool also isn’t a stock research platform. They have some stock market information, sure; but it’s not robust. If you’re in search of deep-dive research, you should look at Zacks (read our Zacks Home Run Investor review) or TradingView (read our TradingView review) as alternatives.
Pro Tip:
The Motley Fool Canada Stock Advisor picks stocks from both Canada and the U.S. that they believe will beat the market. In fact, over the last decade, the Fool’s Canadian stock picks have beaten the TSX by over 20%, and their U.S. picks have beaten the S&P 500 by over 40%. Save CD$200 and try it for just $99 for your first year. (30-day money-back guarantee)!
Motley Fool Stock Advisor Canada Features
The Motley Fool Canada Stock Advisor offers a ton of useful features. Some are only available with higher tier plans. That said, there’s a lot you can do with the least expensive plan if you’re not willing to spend much.
Coverage
The Motley Fool Canada Stock Advisor subscribers at every level get access to Motley Fool articles and updates. You’ll always see a few highlights on the home page and can get to the rest by clicking “See All Coverage.”
Notice that there’s a combination of things to read, including buy and sell recommendations and overviews.
Recommendations
One of the biggest selling points of the Motley Fool Canada Stock Advisor is their recommendations.
Your recommendations will come by email, and you can opt in for additional email advisories if you want to. Picks vary from plan to plan, and we’ll review those later.
Updates
Speaking of those special advisories, updates are something you’ll want to keep a lookout for in your inbox. There’s a special Updates section on the menu where you can find:
- Updates
- Best Buys Now
- Stocks on Our Radar
- Watchlist
You’ll also get email updates from the Motley Fool when there’s breaking news. Here’s an example:
Another thing you’ll find under updates is a list of “Stocks on the Radar.” Viewing these provides a peek into what the folks at the Motley Fool are watching in the stock market but haven’t recommended… yet.
What we like about the Updates section of the Motley Fool website is that it gives subscribers easy access to the latest news, trends, and stock prices.
Scorecard
The Motley Fool’s Scorecard offers a snapshot of where their stock recommendations are on the day you view them compared to the day they recommended them.
You can see that some of these stocks have experienced growth of over 30% in 1-4 months. That’s impressive by any standard.
Forum
Like a lot of stock pickers, the Motley Fool has a forum area where subscribers can communicate. Most of the topics are stock-specific.
What we’d say about the forum is that it’s not really a place for idle chatter. Investors share their thoughts about acquisitions and recommendations but don’t often go into a lot of detail.
Pro Tip:
The Motley Fool Canada Stock Advisor picks stocks from both Canada and the U.S. that they believe will beat the market. In fact, over the last decade, the Fool’s Canadian stock picks have beaten the TSX by over 20%, and their U.S. picks have beaten the S&P 500 by over 40%. Sign up for the Motley Fool Canada Stock Advisor with a 30-day money-back guarantee!
Motley Fool Canada Stock Advisor Plans
The Motley Fool offers a total of nine plan options for Canadian investors, including four premium tiers, three bundles, and two portfolio services. Here’s the breakdown on the features included with each.
Stock Advisor
- Flagship service
- 2 stock picks/month, one from the U.S. and one from Canada
- Best Buys Now – five timely picks from 150+ stocks
- List of starter stocks
- Access to member forums
- Community and investing resources
Dividend Investor
- Tailored for individuals looking for high-yield opportunities
- 1 new high-conviction Canadian pick per month
- 1 “wild card” U.S. pick each quarter
- Access to dividend stock watch list
- Access to member forums
- Community and investing resources
Hidden Gems
- Focuses on smaller U.S. and Canadian companies, typically valued at CA$5b or less
- Two high-conviction small-cap stock picks each month, one Canadian and one from the U.S.
- Selection of “Best Buy Now” stocks released monthly
- Annual list of Starter Stocks
- Access to member forums
- Community and investing resources
Rule Breakers
- Focuses on “uncovering great companies early in their growth period”
- 2 high-conviction monthly growth stock recommendations from the U.S.
- 6 Canadian growth stock recommendations per year
- Access to member forums
- Community and investing resources
Bundles
There are three bundles you can buy if you want multiple services.
- The Epic Bundle combines Stock Advisor Canada, Dividend Investor Canada, Rule Breakers Canada and Everlasting Stocks. (Everlasting Stocks is a service only offered in bundles.)
- Market Pass combines Stock Advisor Canada, Dividend Investor Canada, Rule Breakers Canada, Hidden Gems Canada, and Everlasting Stocks.
- Master Pass Small Caps gives comprehensive access to all small-cap research and microcap focused services, including Hidden Gems Canada, Discovery Canada, Microcap Mission, Firecrackers Service, and access to the Motley Fool’s live stream.
Portfolio Services
Want more than two stock picks per month? Consider signing up for one of the Motley Fool’s portfolio services.
- Discovery Canada includes vetted stocks that meet the Motley Fool’s rigorous standards. The portfolio contains stocks traded on both the NYSE/Nasdaq and the TSX.
- Partnership Portfolio gives subscribers access to a bespoke Motley Fool investing strategy. Extensive research is used in accordance with the Motley Fool CEO Tom Gardner’s X-Factor investing system for evaluating founder CEOs. This portfolio contains stocks traded on both the TSX and the NYSE/Nasdaq.
The Motley Fool Canada Stock Advisor also has a substantial selection of additional portfolio services that aren’t open to new members at this time. You can find them on the premium plan page and request information on any services that interest you.
Motley Fool Canada Stock Advisor Prices
Here’s a quick rundown of the prices for each plan.
- Motley Fool Stock Advisor: CA$299 per year
- Dividend Investor: CA$349 per year
- Hidden Gems: CA$499 per year
- Rule Breakers: CA$499 per year
- Epic Bundle: CA$699 per year
- Market Pass Bundle: CA$999 per year
- Master Pass Small Caps: CA$4,999 per year
- Discovery Canada: CA$1,199 per year
- Partnership Portfolio: CA$1,199 per year
The cost of the Stock Advisor service is in line with what most other stock picking services charge. It may be worth bumping up to one of the higher tiers if it matches your investing style, but you can get plenty with the lowest tier.
How Have the Motley Fool Canada Stock Advisor’s Picks Performed?
Before you fork over any of your money to the Motley Fool, let’s answer the burning question. Are their picks any good? How much can you expect to earn if you invest based on their recommendations?
Let’s start with the TSX. Here’s a snapshot showing that the return of all recommendations is nearly double that of the S&P/TSX Composite Index.
The U.S. numbers are better still. The Motley Fool recommends a buy and hold investing philosophy. The stocks they’ve recommended have outperformed the S&P 500 by between 40% and 160% over the past five years. More than 70% of their recommendations have been profitable!
We did our own 10-year comparison. It revealed that the Motley Fool’s TSX picks outperformed the benchmark by 23.10% and its NYSE picks outperformed the S&P 500 by just over 40%.
We’d be remiss if we didn’t mention that none of this is a guarantee. You could buy the Motley Fool Canada Stock Advisor’s recommendations and lose money.
That said, we think that compared to other stock pickers, the Motley Fool is close to, if not at, the head of the pack.
Is the Motley Fool Canada Stock Advisor Worth the Price?
The point of this Motley Fool Canada Stock Advisor review is to help you decide if you should give it a try. Here’s our take.
The Motley Fool Canada Stock Advisor is exactly what it promises to be. It’s a stock picking service that has a pretty impressive track record.
There are plenty of tools that come with a subscription. You’ll be able to monitor your portfolio and picks, and you can view some historical data. And you’ll get access to the Motley Fool’s regular updates either on the website or via email.
All in all, we’d say that if you’re willing to commit to a buy and hold strategy and you want some help picking investments, the Motley Fool Canada Stock Advisor service is worth the price.
As for the more expensive subscriptions, those should be viewed on a case-by-case basis.
If you’re looking for income-generating stocks, the Dividend Investor plan is probably worth an extra CA$50 per month.
The same can be said of the Hidden Gems and Rule Breakers plans. If you want to focus on small-cap stocks, try the former. If you’re looking for startups to invest in, Rule Breakers might be worth an extra CA$200 per month.
All in all, though, we’d suggest starting with the Motley Fool Canada Stock Advisor and getting familiar with its features first. You can always upgrade later!
Pro Tip:
The Motley Fool Canada Stock Advisor picks stocks from both Canada and the U.S. that they believe will beat the market. In fact, over the last decade, the Fool’s Canadian stock picks have beaten the TSX by over 20%, and their U.S. picks have beaten the S&P 500 by over 40%. Sign up for the Motley Fool Canada Stock Advisor with a 30-day money-back guarantee!
Conclusion
What’s the final take away from our Motley Fool Canada Stock Advisor review? We think it’s one of the better stock picking services that includes TSX stocks.
Historical performance of their picks is impressive, with about 70% of picks earning investors a profit. Both their TSX and NYSE picks outperform benchmarks. That’s nothing to sneeze at.
Their 2023 picks are off to a great start and beating the S&P by double digits already and 83% of those picks are profitable.
Their website has a nice, clean interface. It’s easy to find what you need and everything’s nicely laid out.
We wish they offered a free trial. They do have a 30-day money-back guarantee, so you can cancel if you’re not impressed.
If you’re willing to commit to a buy and hold strategy and you’re interested in TSX picks, we recommend giving it a try!