Updated on 5/27/2023.
The Motley Fool and 7investing both offer popular investment newsletters that aim to beat the market. In this review of the Motley Fool vs. 7investing, we will discuss the pros and cons of each service. On the Motley Fool side, we will look at Stock Advisor and Rule Breakers and see how they compare to 7investing. Specifically, we will compare the performance of the newsletters, the quality of the stock reports, and the overall value of each service. (Click here to read our review of Stock Advisor and click here for our review of 7investing.)
The opinions in this review are our own based on our personal experience with these services. We do not let advertisers influence our content. This content has not been provided by or endorsed by any advertiser. To support our work, some of the links in this article might be from our sponsors.
Motley Fool vs. 7investing: Quick Summary
- Stock Advisor, Rule Breakers, and 7investing are popular investment newsletters that aim to outperform the market (as measured by the S&P 500). This article provides an in-depth overview of each service, as well as their historical performance.
- The Motley Fools offers dozens of investing newsletters. They range in price from $149 to $13,999 per year. Each newsletter focuses on a specific industry, market cap, and/or investment strategy and comes with different levels of risk and potential returns.
- 7investing offers a single investment newsletter that publishes their 7 highest-conviction stock ideas on the first day of the month. Their recommendations range from “low risk” to “very high risk” investments (everything from large, dividend-paying stocks to micro-cap stocks with significant growth potential). Investors can select stocks from that list based on their goals, timeline, and risk tolerance. This service costs $49 per month or $399 per year*.
- While we are fans of all three services, we believe 7investing offers the best overall value in terms of price and risk-adjusted returns (as always, past performance does not guarantee future results). If you’re already familiar with 7investing and the Motley Fool, feel free to skip to the side-by-side comparison section.
- As of this writing, many growth stocks are experiencing significantly compressed valuations, with many stocks down 50% or more. The three newsletters discussed in this article often recommend growth stocks, so their returns are down big at the moment. However, investors with a high risk tolerance may view this as a buying opportunity. (At Inveduco, we fall in this category and are currently taking advantage of these compressed valuations.)
Table to contents
- Are investment newsletters worth it?
- Motley Fool Quick Review
- 7investing Quick Review
- 7investing’s New Starter Plan
- How much overlap is there between 7investing and the Motley Fool?
- 7investing vs. Motley Fool: Side-by-Side Comparison
- Motley Fool vs. 7investing: Conclusion
Are investment newsletters worth it?
A good quality investment newsletter can save you hundreds of hours of research and can potentially supercharge your portfolio. It can help you find tomorrow’s winning companies while they’re still small and unknown to the general public. It can also help you identify medium and large companies that still have a lot of room to grow. Each newsletter has its own objectives, such as generating income or outperforming the market. Unfortunately, many investment newsletters under-perform the market. This is especially true with market-timing newsletters.
Mark Hulbert spent 36 years tracking the performance of investment newsletters and published his findings in a service called Hulbert Financial Digest. His research showed that most market-timing newsletters failed to steer their members out of the market prior to a crash or back into the market at the start of a new bull market. However, it’s important to distinguish between market timing and market beating strategies. Hulbert’s research has shown that buying and holding quality companies over the long run can help you to beat the market. However, according to Hulbert, this requires “the all-too-rare discipline of holding on to recommended stocks through bear markets.”
Motley Fool Quick Review
We start this review with the Motley Fool, as it is the oldest of the two companies. The Fool was founded in 1993 and is a widely recognized name in the investment world. They have branches in several countries, including in the UK, Germany, and Japan. The company was started by Tom and David Gardner, neither of whom had any formal education in finance (both majored in English). They currently have more than 300 employees. The “Fools” are passionate about finding winning stocks and sharing their knowledge with the public. They do a great job at educating members on the merits of long-term investing.
The Motley Fool website offers more than 35 different premium services as well as numerous special reports. Many of their investment newsletters focus on a specific industry, such as cloud computing or marijuana stocks. The newsletters range in price from $149 to $13,999 per year, and the special reports sell for $100 to $1,200 per report1. The Motley Fool frequently adds new services and heavily promotes them via emails and live video presentations.
Some Motley Fool services can be purchased for a low introductory price, such as $99/year for their Stock Advisor or Rule Breakers newsletters. After the trial period, Stock Advisor automatically renews for its regular price of $199, whereas Rule Breakers goes up to $299 per year.
One of the disadvantages of having so many newsletters is that it can get expensive to get the Fools’ best stock ideas from across different industries. Entry-level services like Stock Advisor or Rule Breakers both offer great stock recommendations. But if you want their stock ideas with the greatest growth potential, you’ll need to upgrade to one of their higher-end newsletters (which typically sell for $1,000 to $2,000+ per year).
When you read marketing emails for their higher-end newsletters, you’ll often see examples of individual stocks that performed really well. Unfortunately, they don’t publish the overall historical performance of these services4. Without this performance information, it’s hard to say if they are worth the extra money. It would be interesting to know how they compare to Stock Advisor or Rule Breakers.
It should be mentioned that Rule Breakers’ recommendations have, on average, significantly under-performed Stock Advisor in spite of the service being 50% more expensive and often being advertized as offering greater growth potential. So a higher membership price does not necessarily translate to higher performance.
One issue Motley Fool members have raised over the years is that some stocks are recommended across multiple newsletters. Some stocks are recommended by as many as a dozen Motley Fool newsletters. Another issue is conflicting advice among their newletters (e.g. one newsletter might actively recommend to buy a stock while another newsletter might be advising members to sell it). This is due to the fact that each newsletter is managed by different Motley Fool advisors. Finally, a common complaint we hear when it comes to articles by the Motley Fool is that they tend to sensationalize their stock recommendations (with titles like “2 Unstoppable Stocks to Buy Right Now” or “1 E-Commerce Stock Ready to Pummel the Market in 2023”).
Bottom line: Stock Advisor and Rule Breakers are two entry-level investment newsletters offered by the Motley Fool. We are big fans of both. They often recommend widely-known companies (that is especially the case with Stock Advisor). This can be a good thing, as it is easier to buy and hold companies whose products you’re familiar with, especially during a bear market. That is not to say that they only recommend well-known companies. There’s a good mix of businesses from various industries and many of them will be new to the average investor. While both newsletters have been beating the market over the long-run, if you want their “hottest” stock tips, you will need to subscribe to one of their higher-end newsletters. Once you sign up for any of their services, you will start receiving frequent emails promoting their latest newsletters.
7investing Quick Review
7investing was started back in March of 2020 by Simon Erickson. The company offers an investment newsletter for $49 a month or $399 a year*. Every month, their lead advisors publish their 7 highest-conviction stock ideas. These can be selected from any industry, market cap, or country as long as they can be easily purchased by individual investors on an American exchange.
*SPECIAL DISCOUNT: Try 7investing for FREE. Use promo code “TAKE100” to save $100 on an annual 7investing membership. Sign up at: https://7investing.com/subscribe/. Your membership will renew at the discounted rate ($299/year) for as long as you remain a member.
7investing was founded with the goal of helping you invest in great companies and generate market-beating returns over the long run. One of the big advantages of 7investing is that they put all their focus into a single newsletter. So, as a member, you only get their highest-conviction stock ideas. As a result, they don’t send any promotional emails.
You don’t have to buy all seven stocks each month to benefit from this service. Every recommendation is labeled with a different risk level (ranging from “low” to “very high”) and investment style (such as “growth”, “international”, or “income”) so it’s important to carefully consider each stock in light of your goals and risk tolerance.
7investing’s lead advisors have impressive backgrounds and a long history of beating the market prior to joining the company. Simon Erickson (7investing CEO) has a BS in Chemical Engineering and an MBA in Entrepreneurship. Prior to starting 7investing, he ran an investment newsletter that focused on innovative trends. He also directed a $1 million+ investment portfolio for the Motley Fool prior to starting 7investing. (You can read our interview with Simon Erickson here.)
Each lead advisor brings a unique set of skills and expertise. This gives 7investing an edge when analyzing companies from various industries. Steve Symington has a BS in Computer Science and Mathematics. After working as a software developer for seven years, he joined the Motley Fool where he served as a lead analyst for an Artificial Intelligence portfolio that outperformed the market by 40% over time. Dana Abramovitz focuses on biotech companies and has a PhD in biochemistry and molecular biophysics. Anirban Mahanti, PhD, specializes in computer networking, data science, and machine learning. Matthew Cochrane is a detective at a Florida police department with a passion for investing. Luke Hallard specializes in technology and health-tech companies, among others. Krzysztof Piekarski, PhD, focuses on SaaS and futuristic tech companies.
One of the things we love about 7investing is the level of transparency when it comes to their process of identifying winning stocks. Each month, 7investing publishes videos showing each lead advisor pitch a stock to their team. They have to explain why they believe that the stock will outperform the market, and then defend their investment thesis when challenged by other lead advisors.
Their monthly stock reports cover a lot of information on each company (click here to see an example). Each report includes a “Deep Dive” video which discusses the investment thesis, risks, and valuation. These videos give members key information to make an informed investment decision. Here is a publicly available mock Deep Dive video to give you an idea of the format. 7investing also produces a large amount of free and premium video and audio content along with transcripts so you can go over their content in your preferred format.
Finally, one of the things that really sets 7investing apart is their level of engagement with their members. You can ask questions in real time on one of the many live videos they produce. You can also email them or message them via Twitter and they tend to respond very quickly (often within hours). Their responses are personalized, well thought-out, and you can tell that they are passionate about helping their members. The education you get from 7investing is worth the price of the membership on its own.
Bottom line: 7investing selects stocks from various industries and market caps and then publishes reports containing their highest-conviction stocks without any upselling. The membership is affordable enough to allow anyone to get started with relatively small amounts of money (they also have a special discount for students). If we had to pick a single service out of the three reviewed in this article, 7investing would be it.
Sign up for 7investing using promo code “TAKE100” to get $100 off on an annual membership (which comes out to $25/month). Your membership will renew at the discounted rate ($299/year) for as long as you remain a member.
7investing’s New Starter Plan
7investing introduced a new discounted Starter Plan in early 2023. For $17/month, Starter members get access to two randomly selected stocks from the 7 companies selected by their lead advisors. Each stock recommendation includes the research report and deep dive video that regular members have access to. Members of the Starter plan do not get access to the monthly Best Buys or subscriber calls. As of 5/14/2023, the average performance of the Starter membership is 18.32% vs. 2.30% for the S&P 500.
|Starter Membership||Premium Membership|
|Price per recommendation||$8.50||$7*|
|Monthly Best Buys||No||7|
|Full access to Discord Forum||No||Yes|
*This assumes that the member is paying the full monthly price. An annual premium membership ($399) brings the price per recommendation down to $4.75. If you sign up for an annual membership and use promo code “TAKE100” ($299/year), the price per recommendation goes down to $3.55.
How much overlap is there between 7investing and the Motley Fool?
Here are some statistics as of December 30th, 2022:
|Service||Unique Active Recommendations|
|7investing||Rule Breakers||Stock Advisor|
Specifically, out of 264 unique active recommendations between 7investing and Stock Advisor, we found 38 duplicates. Looking at 7investing and Rule Breakers, there were 40 duplicates out of 223 unique active recommendations. Finally, we found 33 duplicates between Stock Advisor and Rule Breakers out of 288 unique active recommendations.
These numbers has changed a bit since we last compared the three services, back in June of 2021. Back then, out of 244 unique & active recommendations between 7investing and Stock Advisor, only 15 stocks (or 6.1%) were recommended by both services. As for Rule Breakers and 7investing, we only found 20 matches out of 204 unique & active recommendations (9.8%)6.
Stock Advisor tends to recommend larger, more established companies, whereas Rule Breakers often recommends slightly smaller companies. While 7investing recommends both large and small companies, they often recommend smaller companies that are earlier in their growth journey and have greater growth potential. In fact, they recommend small and micro cap stocks almost every month. Motley Fool tends to reserve their micro cap stocks for their more expensive services, such as their “Everlasting: Firecrackers” service.
Motley Fool vs. 7investing: Side-by-Side Comparison
The chart below looks at the three newsletters side-by-side:
|Stock Advisor||Rule Breakers||7investing|
|Number of new monthly stock recommendations:||2||2||7|
|Monthly stock re-recommendations:||10||10||7|
|Annual cost (at regular price):||$199||$299||$399|
|Performance (March 2020 through May 2023) 2||-23.86%||-21.77%||-10.01%|
|Volume of promotional emails sent to members:||High||High||None|
|Does it provide updates on past recommendations?||Yes||Yes||Yes|
|Does it promote long-term investing?||Yes||Yes||Yes|
|Does it recommend small cap stocks?||Rarely||Sometimes||Often|
|Does it pick stocks from across many industries?||Yes||Yes||Yes|
|Is there a message board for members?||Yes||Yes||Yes|
Historical returns (archive):
|Stock Advisor||Rule Breakers||7investing||ARKK Fund7|
|3/1/2020 through 5/27/2023||-23.86%||-21.77%||-10.01%||-36.94%|
|3/1/2020 through 12/13/2022||-35.99%||-31.61%||-21.01%||-48.82%|
|3/1/2020 through 7/5/2022||-36.94%||-35.85%||-24.94%||-42.88%|
|3/1/2020 through 5/29/2021||30.09%||19.71%||29.97%||37.75%|
|3/1/2020 through 3/31/2021||26.36%||18.80%||40.84%||55.77%|
Number of new stock recommendations each month
This metric only takes into account new recommendations, as those are the only stocks tracked in their respective scorecards. In addition to the 2 official monthly recommendations, Stock Advisor also publishes a list of 5 “Best Buy Now” stocks twice a month (Rule Breakers publishes a list of 10 “best buy” stocks ranked and updated monthly). These are typically short reports listing previously recommended stocks that the Fool believes present “timely buying opportunities”.
As for 7investing, each of their advisors selects a Best Buy stock which is disclosed during the monthly members-only team call. It should be noted that 7investing considers all their stock recommendations to be evergreen “buys” indefinitely (unless something really bad occurs at one of the companies, at which point they would issue a “sell” recommendation). Also, they publish a “conviction rating” next to each stock and it gets updated on a regular basis. This is one of the most useful features of 7investing.
Bottom line: Stock Advisor and Rule Breakers publish 2 new stock recommendations and 10 “Best Buy Now” re-recommendations each month. 7investing publishes 7 new stock recommendations and 7 “Best Buy” re-recommendation every month.
The Motley Fool will sometimes offer a low introductory rate on their Stock Advisor and Rule Breaker services, however, once the discounted period ends the service will auto-renew at the full price. While both services offer interesting stock recommendations, you will need to upgrade to one of the Fool’s higher-end services to get their stock picks with “maximum upside” potential. These services typically cost well over $1,000 per year.
7investing comes with a simple pricing structure: $49 per month or $399 per year. In our opinion, a 7investing membership is worth $49 a month. When you take the quality of their reports into account, the slightly higher price of their membership seems justified. To put the price in perspective, at $399 per year and with seven full-time analysts, you are paying each analyst the equivalent of under 3 cents per hour for their research!5
This gives you full access to all their recommendations, as well as their premium articles and videos. The thing we like about 7investing is that they only have one newsletter with their highest-conviction stock ideas each month. As a subscriber, you are never asked to upgrade to other newsletters, as you already have access to their full content.
Bottom line: 7investing costs $49/month or $399/year and they provide their best stock ideas from across all industries, market caps, and countries. Stock Advisor costs $199/year, although new customers can try the service for $99 for the first year. Rule Breakers costs $299/year (new customers can try it for $99 for the first year). Stock Advisor and Rule Breakers are both entry-level services. The Motley Fool reserves their best stock ideas for their higher-end services. Although 7investing has increased their prices in July 2021, when you compare them to the Motley Fool’s higher-end newsletters, 7investing remains significantly less expensive.
When you sign up for Stock Advisor or Rule Breakers you quickly discover that they send weekly -often daily- marketing emails. Unfortunately, these emails offer relatively little value and usually promote their latest newsletter. Once in a while, you’ll get an email with valuable content, such as a special report with stock recommendations, but many are promotional emails. Obviously, this method must be somewhat effective since they have been doing this for years but it makes for a frustrating experience for members.
7investing members, on the other hand, get full access with no marketing emails. When they do send emails, they offer valuable content, such as notifications about new stock recommendations or industry updates.
Bottom line: Everyone hates marketing emails. Sadly, the Motley Fool sends quite a few of them. Overall, they offer great content but they reserve their top stock picks for their highest-paying members. 7investing offers their best stock ideas to their members at an affordable price. We have not received a single promotional email from 7investing to date.
Motley Fool vs. 7investing: Conclusion
We really like both companies and picking a favorite was not easy. 7investing, Stock Advisor and Rule Breakers all provide a great list of stock recommendations. We own stocks recommended by all three services and have earned nice returns from some of these companies.
All three services promote long-term investing, which is great. We believe that no matter which service you pick, you will likely do well if you invest over a long period of time. However, if we had to pick one, it would have to be 7investing. Every month, each advisor is asked: “What’s your best idea right now?” That becomes their primary focus for the month. We are big fans of this strategy. Ultimately, we picked 7investing for 4 primary reasons:
- They put all their efforts into a single newsletter.
- The high performance of their stock picks during the last bull market.
- The service is affordable for the average investor.
- Excellent customer service and high level of interaction with their members.
If we had to pick a second favorite newsletter out of the three -and this would not be an easy choice since they are all great- it would probably have to be Stock Advisor. Even though David Gardner’s picks in Stock Advisor have performed better than Tom’s, it seems that Rule Breakers (which focuses on David’s stock-picking strategy) has under-performed Stock Advisor since inception. We are big fans of David Gardner’s work. But when you add the higher cost of Rule Breakers and the relative underperformance when compared to Stock Advisor, it seems difficult to justify the extra $100 per year.
Let us know in the comments if you have signed up for any of these services. We would love to hear about your experience!
- As of December, 2022
- As of December 13th, 2022. 7investing started in March 2020, so we used that as the starting date for all three services to have an equitable side-by-side comparison over the same time frame. We will continue to update these performance numbers over time. Note: On the week of 12/12/2022, the Motley Fool unveiled a new format for their website, which no longer includes a single list of open and closed positions. Instead, current recommendations and closed positions are now listed separately. Unfortunately, the list of closed positions no longer specifies the initial date of those recommendations, which makes it impossible to accurately calculate returns of both open and closed positions from March 2020 to December 2022. Therefore, as of December 2022 and going forward, the returns listed for Stock Advisor, Rule Breakers and 7investing will no longer take closed positions into account.
- With the exception of Stock Advisor and Rule Breakers, as of December 18th, 2022.
- When looking at https://www.fool.com/services/, the only services that list an overall performance are Stock Advisor and Rule Breakers (as of 12/16/22).
- This assumes that each analyst works 40 hours per week and takes 2 weeks of paid time off per year.
- As of June 28th, 2021. We will periodically update these numbers.
7. ARKK returns assume a dollar-cost averaging strategy of investing the same amount on the first day of the month (or next available trading day) to make a like-for-like comparison to the 3 investment newsletters.
Very cool and informative.
Useful information. Thank you.
As a 7Investing subscriber I can confidently say they offer incredible value. The amount of time devoted to each pick is crazy good, and I love the subscriber calls!
Thanks Leah! Agreed, the subscriber calls are great.
As a 7investing, Stock advisor and Rule Brakers subscriver I agree with the reviews and conclusions of this article.
Although they are both good services I prefer the 7investing service.
Another plus for 7Investing vs. The Fool, should you want to cancel (I don’t!), you can easily just hit the Cancel Subscription button on your Account Settings page. Motley Fool doesn’t make it as easy. You have to call in to an understaffed help desk and talk to someone in person.
I like both 7Investing and TMF, but I agree with the review, 7Investing is a better service for a better value. I subscribe to both though.
That’s a good point, Mike!
MFool as now an unsubscribe bottom on the account settings. Having new competitors always improves the service for consumers 🙂
If you look hard enough, you can extend your motley fool rule breakers or stock advisor for $49 a year….trust me, I am extended to 2026…..
Yes, that is correct. It’s not their “official” pricing which is why we didn’t list it in the article.
I agree with much of the article except what Mike mentions above and three other points. First the history of 7Investing is short (not to be blamed and does not make it bad) so the correct comparison is not to say that the only valid time period is the last 14 months but instead to say it to short of a time to make a valid call. Fine to state what the results have been but sorry, too short of a time to make a valid call. The second point is I have had no trouble cancelling newsletters online without talking to someone from customer service. I just turn off the feature. Now despite that I will try 7Investing but mainly because a number of the team are former MF folks who I grew to like while they were at The Fool and so will see what they have got. I am sure it will be good. The last and major point that I find a turn off and has me a little hesitant is the statement that the best picks for MF are held back from RB and SA. I find that claim to be indefensible. Picks like Amazon, Netflix, Activision-Blizzard, Nvidia, Monster, Marvel and many others I dare say are amongst their best picks. Amongst the very best picks were Dave Gardner’s 5 stock picks done freely in his weekly podcast that he chose anew about 4 or 5 times per year. So an insinuation that you have to pay to get their good stuff I do not believe holds merit.
Thanks for your thoughtful comment, David! You bring up a lot of good points.
You are right that companies like Netflix and Amazon have been incredible stock picks, especially if you bought them in the early 2000s, when they were first recommended. (You would probably agree that at today’s prices, they are unlikely to be 10 baggers from here, right?)
But wouldn’t it be fair to say that the Fools reserve their “hottest” stock picks (i.e. stocks they believe have the highest long-term growth potential) for their higher-end services, and only later might share them with SA or even RB? If not, then how can they justify those services costing 5 to 10 times (or more) the cost of a Stock Advisor subscription?
And you are absolutely right that David Gardner had freely shared a lot of very valuable information, (including stock tips) on his podcast, which we are big fans of. There is no question that the Motley Fool has been a tremendous resource for investors for many years now.
Comments are closed.