What Are Motley Fool 10 Best Stocks?

Motley Fool's 10 Best Stocks is a list of companies they believe are great for long-term investing. Choosing the right stocks can be hard, since there are so many companies, ETFs, and mutual funds to pick from. Motley Fool focuses on businesses that are leaders in their industries. These companies usually have lots of room to grow, and strong durable advantages over competitors.

Motley Fool's 10 Best Stocks is a free sample of top stock ideas from them. Their core offering is a subscription-based Stock Advisor online platform (more on that later).

Why Are Motley Fool 10 Best Stocks Important?

As investors, we are always on the hunt for the next big thing.

By investing in solid companies with great growth potential, we are setting ourselves up for success over time.

In short, we want to find winners early to reap the big gains.

As Gordon Gekko said in the 1987 film Wall Street:

Exactly how big are the gains? Here are some of Motley Fool's GOAT picks:

Source: Motley Fool

Since then, these stocks have all became household names, and the rest is history.

Motley Fool is a guide to finding overlooked companies they believe could be "posed to shatter the market – often when these businesses are flying under Wall Street’s radar."

Does Motley Fool really work? Is it right for you?

In this guide we will explore:

• Is it worth paying for Motley Fool?

  • What Motley Fool say themselves

  • What people say online

  • Actual performance of Motley Fool

• Motley Fool's dirty little secrets

• How to use Motley Fool correctly?

Is It Worth Paying for Motley Fool?

Motley Fool's core offering is a subscription-based Stock Advisor online platform. Starting at US$199 per year (or $39 per month), this premium service provides two monthly stock picks and investment education.

The next tiers are Epic at US$499 per year (5 monthly stock picks) and Epic Plus at US$1,999 (8 monthly stock picks). The most expensive tier is Fool One at US$13,999 per year.

Is Motley Fool worth it? I will try to answer this question from 3 angles:

1. What Motley Fool say themselves

2. What people say online

3. Actual performance of Motley Fool

1. What Motley Fool Say Themselves

According to the Motley Fool, as of 4/1/2025, their Stock Advisor returned +812% vs +163% from S&P 500.

How fitting... I am writing a Motley Fool review on April Fool's Day.

Yet, the cumulative return chart below from Motley Fool is no joke!

2. What People Say Online  

With such big returns, you'd expect the forums to be full of praise.

Surprisingly...

People in the discussion forum hold quite divisive views.

Negative Comments (Click image to see post)

Positive Reviews (Click image to see post)

How can people have such vastly different experiences using the Motley Fool's service?

Why do some people see something in such a positive light, while others perceive it so negatively? Imagine two individuals looking at the same painting in an art gallery. One sees a young woman with her face turned away from the viewer. Meanwhile, the other notices an old woman gazing downwards at the floor.

3. Actual Performance of Motley Fool

Let's look at the actual recommendations from the Motley Fool's Stock Advisor.

I have reviewed Motley Fool's recommendations from 2014 to 2025, the "Review Period." There is an 11-year limit on the lowest tier Stock Advisor recommendation data.

I looked at recommendations from Buy to Sell during this Review Period. I have also treated repeated Buy calls as continuous. In other words, first Buy until last Sell within the available data period.

Oustanding Buy calls as of the last day of the Review Period are marked to market.

There are a total of 185 stock tickers, which are "Hold Till End" in this Review Period.

How Accurate are Motley Fool's Stock Picks?

Hold Till End

63% correct calls with an average of 134.8% return on these 185 tickers over the last 11 years. This average result from 185 tickers is for all holding periods, which range from 1 month to 11 years.

Hold 3 Years

If we only consider a holding period of 3 years (140 tickers left), filtering out the shorter ones. The win rate improved to 68%.

See charts below for a complete picture:

Risk-Adjusted Win Rates

Yet, if you adjust for the risks involved, the win rates will be re-rated entirely.

Make sure you read on to find out the risk-adjusted win rates (more on that later).

Is Motley Fool a Long Term Play?

Yes, very much.

As the above data shows, the longer you hold, the better the performance. If you followed Motley Fool Stock Advisor's advice for the past 5 years, the win rate would be 72% with an average return of 167.1%.

In fact, Motley Fool's recommendation is for 5 years or more.

In our review period, 56% of the stocks (or 104 tickers) are >5 years. The actual average duration is 7.8 years.

Let's look at the breakdown for holding periods in the chart below:

Motley Fool has an excellent strategy to ensure people subscribe to their Stock Advisor for the long term.

With such good numbers what are people online complaining about?

Motley Fool's Dirty Little Secrets

We will now reveal what Motley Fool doesn't tell you straight up...

And what causes disappointments like this:

The State of Regret

In trading and investing, there are many ways to be in a State of Regret.

For this article, we limit the "State of Regret" to price drop(s) after Motley Fool recommended buying it. In other words, the period when the investment is "underwater."

We will use the next day's closing price as our entry price for each buy call in the Review Period. The lowest price since Motley Fool's recommendation is the "Lowest Drop" point. We will also exclude any assumptions on fees and expenses.

Let's explore why using the Motley Fool may put people in a State of Regret.

If you follow Motley Fool's advice and hold stocks for 3 years in the Review Period:

• 59% chance the Lowest Drop could be between 0.01% to 35%.

• 35% chance the Lowest Drop could be between 35% to 99%.

• Only 6% chance no drop at all.

• Overall average, the Lowest Drop is 31.7%.

Watching your hard earned money drop by 40-50% is quite painful.

Using Motley Fool's Stock Advisor requires patience and persistence. You may need both before seeing big returns.

When trying out Motley Fool, most people buy 2-3 stock recommendations to see how it goes. As demostrated in the dataset, this approach almost guarantees leading you to a State of Regret at some point.

The safer approach is counterintuitive — buy all the recommendations in smaller amounts. This way you don't miss out on the home run hits.

Comparing Apples with Oranges

Remember the impressive cumulative return chart Motley Fool compares its stock picks return with the S&P 500 Index?

Let's try to pick it apart.

Instead of the stock picks data, we will be using an ETF managed by Motley Fool, as proxy, to review its performance. This is an objective way to show how Motley Fool's stock picks perform in real trading situation, with Fools at the helm themselves.

We will be reviewing the Motley Fool 100 Index ETF (Ticker: TMFC).

According to Motley Fool:

Compare with S&P 500 Index (the Low Bar)

Here are the results of the Motley Fool 100 Index ETF compared against the S&P 500 index.

If you parked $10,000 in TMFC since inception from early 2018, your capital will increase to $28,688 after 7.2 years. Net profit is 186.9% vs. 98.8% from S&P 500 index (.SPX). That is very impressive considering TMFC's returns are:

1. After transaction fees to buy / sell stocks.

2. After management fees (expense ratio of 0.50%).

From an annual return view, TMFC on average returned 15.8% per year, while S&P 500 was 10.1%. TMFC's return was achieved with annualized volatility of 22.4%, higher than the S&P 500's 19.7%.

Compare with Nasdaq 100 Index (the High Bar)

Something doesn't quite make sense...

Subscribers pay good money to the Motley Fool to find out about the next breakout superstars. Why is the Motley Fool comparing itself to the S&P 500? This index is made up of blue-chip names like Coca-Cola and Campbell Soup...

Let's compare apples to apples.

To be fair, we also compared TMFC against the Nasdaq 100 index (.NDX). This is an index of the top 100 names in the Nasdaq Composite. Both have about 100 stocks.

Many of Motley Fool's high-flyer recommendations eventually made it to this A-list.

Let's take a look at the results:

If you parked $10,000 in TMFC since inception from early 2018, your capital will increase to $28,688 after 7.2 years. The Nasdaq 100 would give you $27,816 for the same period.

The difference is $872.

Unfortunately, the cheapest Motley Fool Stock Advisor subscription costs $199 per year.

Net profit is 186.9% vs. 178.2% from Nasdaq 100 index (.NDX).

On average, TMFC returned 15.8% per year, while .NDX was 15.3%.

As depicted in the above chart, volatility, max drawdown, beta and sharpe ratio are similar between TMFC and .NDX. 

I will let you draw your own conclusions on which is the appropriate benchmark.

The Devil is in the Details

At first glance, Motley Fool Stock Advisor's webpage shows an impressive return of +812% since Feb 2002:

Wait a minute...

The S&P 500 return of +163% seems too small for 23 years. So, I checked the return from Feb 2002 to Mar 2025 which is +400%.

Scratching my head, this is when I noticed the "vs. the S&P 500" fine print below +163%. If I understand it correctly, +163% is the amount higher than the S&P 500 return.

As for the cumulative return chart below:

Motley Fool's webpage lacked the full info needed to review their calculation basis.

I won't speculate. Instead, I will highlight for you the fine print: "Calculated by Time Weighted Return." This method usually relates to incoming new capital when measuring investment returns — The story is not a stright forward one.

When creating sky high expectations, it is also much harder to live up to promises.

I Don't Understand

I understand from Motley Fool that: "over half a million members trust Stock Advisor for their investing research."

I have also gone through Motley Fool's recommendations from 2014 to 2025 to understand their stock picks really work.

What I don't understand is... Why such aggressive marketing?

Living Up to its Motto

The origins of Motley Fool's brand name is as follow:

I am confident that Motley Fool's numbers and descriptions are factually correct. Motley Fool is a big company. It should have financial analysts, lawyers, and compliance teams to check their webpages.

With such resources, why can't they make their value proposition compelling with realistic expectations on the bumpy ride ahead?

For example: Actual client testimonials in going through the drawdowns, the bear markets and eventually how they prevailed.

These stories will be very powerful in advocating for Motley Fool's Stock Advisor. It will also help them take back the narrative from online forums.

I hope the above analysis has helped you understand Motley Fool better.

I also hope the tips below will help set the correct expectations when using Motley Fool's Stock Advisor service.

How to Use Motley Fool Correctly?

At Least They Tried

For each Buy, Hold or Reduce recommendation, Motley Fool Stock Advisor list out the estimated return, max drawdown and type.

Pay attention to them!

If you haven’t experienced a bear market, the numbers and explanations can’t truly show the pain of a max drawdown.

Well, at least they tried...

Some questions to ask yourself:

• Does this type of risk-return profile match your personality or not?

• Can you accept being in the State of Regret without losing sleep?

• If your funds are tied up in this investment for a few years, do you have backup cash in case of an emergency?

Adjusting Win Rates for State of Regret

In the previous section on win rates, I promised we would go through them on a risk-adjusted basis.

To compensate you living through "hell" or the State of Regret, I propose we add a "hurdle rate" to adjust for this risk.

A hurdle rate is the smallest % return that makes the investment worth your trouble.

In other words, if you can put money in a bank or the U.S. Treasury to earn 3% interest without much risk, then your stock investment should earn more than 3% to worth your trouble.

Adding a 3% hurdle rate means each of Motley Fool's picks should earn >3% per year in order to count as a win, or correct pick.

For example: Adding a 3% hurdle rate, the win rate drops from 68% to 64% in the Review Period (2014-2025) for a 3 year holding period since recommendation.

In the chart below, we added hurdle rates from 0% to 9% for your consideration. We also added different holding periods. Click on it to see how the win rates evolve.

Since everyone has a different risk tolerance, you can choose what fits you best. Then decide if this type of win rate is worth Motley Fool's annual fee.

Adding Milk to Coffee

Some people like to add milk to coffee to make it less strong.

If drawdowns and volatility worry you, try adding some more stable ETFs to your portfolio. It can help "tone things down" a notch.

The concept is similar to a 60/40 portfolio by adding bonds to a stock portfolio.

In Motley Fool's Stock Advisor Toolkit, there are 3 portfolio strategies. They show you how to lower the risk by mixing other ETFs. Yet, it will also lower returns due to this dilution.

While following Motley Fool's stock pick recommendations, diversify 20-50% in ETFs. These include money market, total stocks, and international stocks.

For example, their Cautious Portfolio recommends a 50-50 mix. The estimated results are an annualized return of 8-16%, with a max drawdown of -21%.

The Real Reason for Holding 5 Years or More

Why does Motley Fool recommend holding more than 5 years?

One reason is that win rate and average return does improve. The other possible reason?

To cover their behinds...

If we look back 100 years at the major bear markets, you will find that the longest bear markets last less than 3 years. Even for the Great Depression in 1929.

Thus, the Motley Fool people are no fools at all. They give themselves enough time and buffer to succeed in the long run.

As the saying goes: "Time heals all wounds." Given long enough timeframe, it may even heal some steep drawdowns.

More Lens Bring More Clarity

How might we maximize Motley Fool's stock picks?

Let's consider this analogy...

A telescope lets you see faraway stars and galaxies. A binocular is perfect for birdwatching or spotting wildlife, bringing nature closer. A magnifying glass is a tool for curiosity, helping you explore the tiny details of the world around you.

Fundamental analysis is a telescope. It helps you see possibilities 1 to 3 years down the road. Technical analysis is a binocular or magnifying glass. It helps you clarify the medium to short term.

To be a better investor, try pairing Motley Fool's top picks with technical analysis.