Launched in 2004 as part of the premium services offered by The Motley Fool, Rule Breakers is a Stock Picking Service that offers users access to the best investing opportunities. Every month they send subscribers a curated list of the best stocks to invest in right now and a list of stocks that have a very high chance of making it big in the long term.
This particular Motley Fool service, and most Motley Fool services really, are intended for investors thinking long term: wealth-building and steady growth. If you’re comfortable with 5-year timeframes, this service is for you.
Rule Breakers has over 100,000 monthly subscribers and, along with Stock Advisor, is among the most popular services offered by The Motley Fool. Both these services are similar, but Stock Advisor is marketed more for new investors – if you’re unsure which one is best suited for you, this quick summary will help you decide between the two.
Rule Breakers uses a subscription model, and there are two plans: monthly and yearly. The monthly plan starts at $39/month, and for new users, there’s a special offer for the first year; just $99.
If you are in a bit of a rush, you can check out our quick summary of Rule Breakers.
Pros & Cons of Rule Breakers
2 Growth stock picks every month
182% returns since inception
Access to foundational stocks
Sell/Buy alerts and notifications
Monthly ‘Best Buys Now’ recommendations
Weekly Podcast with Motley Fools co-founder David Gardner
Your investments may be locked long term
Investing in stocks is inherently risky
Features & Benefits Of Rule Breakers
1) Monthly Best Buys & The 2 Best Growth Stocks
Immediately after subscribing to any of Rule Breakers’ plans – monthly or yearly – you will gain early access to the most promising stocks each month. Subscribers will receive a total of 7 recommendations; 2 growth stocks to look out for, and 5 Best Buys Now – the latter are selected by Motley Fool’s analysts and experts from a pool of 200 very promising stocks.
In 2022 some of the early recommended stocks included Etsy (ETSY), Pinterest (PINS), Zoom (ZM), MercadoLibre (MELI), and Shopify (SHOP).
Here are the expected returns from some of those companies:
2) High-Returns – Casually Outperforming The S&P 500
Rule Breakers has a track record of consistency: since its inception back in 2004, it has consistently outperformedthe S&P 500 index – the largest and most followed equity index globally – and not by a small margin. Based on historical performance from the last 18 years, Rule Breakers has comfortably beat the S&P 500 index by a factor of 2 – that is 182% total returns from Rule Breaker and 99% from the S&P 500 index.
3) Access To Foundational Stocks
Another perk when you sign up is instant access to a set of foundational stocks – this list is comprised of must-have, hand-picked stocks that you can be sure will make you money in the long run. Some of these stocks include Airbnb (ABNB), Microsoft (MSFT), and Amazon (AMZN). Rule Breakers recommends that investors keep some of these foundational stocks and at least 25 different stocks in their portfolio to ensure enough diversity. Motley Fool’s philosophy is that by investing in foundational stocks, holding them for 5+ years, and adding new savings regularly, investors will eventually reach financial freedom and their long-term investment goals.
4) Optional – Sign Up For Other Rule Breaker Services
Motley Fool offers three categories of premium services: Stock Picking Services, Specialty Services, and Real Money Portfolio Services. If you need help deciding which premium service is best suited for you, I recommend referring to this Motley Fool services guide, where I go over the most cost-effective services.
As for the Rule Breakers service, it belongs to the Stock Picking Services. Some other services in this category include:
Rule Breakers: Energy Insider, which explores investment opportunities in energy and renewables markets.
Rule Breakers: Biotech Breakthroughs, which focuses on Biotech innovations.
Rule Breakers: Trend-Spotter, which tracks emerging companies and catches possible growth trends.
Rule Breakers: Artificial Intelligence, which focuses on technological breakthroughs in AI.
Keep in mind that to sign up with some of these products, you will have to pay a subscription fee. Fees for all these starts at $1,999/year. Alternatively, you can purchase one of the bundles, which combines several products and comes with a discount.
5) Weekly Podcast Available On Spotify And Apple Podcast
To maintain contact with the community, Rule Breakers has a weekly podcast where David Gardner, co-founder of The Motley Fool, successful author, a wildly experienced investor, and one of the minds behind the Stock Picking Service, talks about some very interesting topics. These topics range from David’s take on Financial Freedom; the evolution of NFTs, featuring ex-directive of Motley Fool and crypto investor Aaron Bush; to real estate investments, featuring analyst Matt Argersinger. There are over 380 episodes, and new ones come out every week.
How Does The Motley Fool Rule Breakers Team Pick Stocks?
During a podcast episode launched in May 2021, David Gardner discussed how he and the analysts at Motley Fool choose their market-beating investments. He uses a 6-step selection process to select only the very best investments. Here’s a summary of how he chooses companies to invest in:
The company is top dog & first mover: Companies that will shape the future – and companies who are the first making a move into uncharted waters.
The company has sustainable competitive advantages: What unique things does that company offer? Things you can’t find anywhere else.
Strong price appreciation: A strong appreciation indicates the company is working effectively, and people are starting to notice.
Good management and early venture backers: Products may change, but David believes that as long as the management team remains, there’s a chance for success.
Consumer appeal: A strong brand that generates trust with customers.
The stock is perceived as overvalued: According to David, there’s a reason for this perception – if you find a stock that checks the first five characteristics, and everybody thinks it is overvalued for the short-term, then that’s probably a good investment for the very long term. Here’s more about the performance of Rule Breakers.
Rule Breakers Fees
Monthly Subscription: $39/month
Yearly Subscription: $99/year
The regular price for yearly subscriptions is $299/year, but for new users, the first year is just $99 – and it comes with a 30-day free trial money-back guarantee.
Anyone can register and create a Motley Fool account, but the company mainly focuses on US citizens. There are no special requirements to create an account; all you need is your name, a valid address, and banking information to purchase a subscription. Remember that if you pick the yearly plan, you have a 30-day trial money-back guarantee if you are not satisfied with the service.
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Rule Breakers has decent reviews from its users, and it holds an average rating of 3.6on Trustpilot. Here’s what some of those users have to say about Rule Breakers:
“Motley Fool is a resource I’ve been using for years. Its articles are clear, concise and don’t put out a lot of excess information. I’ll keep using MF as long as I’m investing.” – Russ F.
“I find the recommendations well researched and with good variety. A few too many emails, though.” – Matt H.
“I have used Motley Fool for 7+ years and continue to be very satisfied. Great analysis of the company and the markets they compete in.” – Gary B.
“Sometimes there is a little too much info in terms of new and exciting opportunities to join new groups.” – Marc.
If you are not fully convinced if this particular service is for you after reading these reviews, would like to read more, or if you are more of a numbers kind of person, I’d suggest checking out this article, which goes more in-depth on the numbers side of the investment.
Rule Breakers is for investors that want to play the long game: wealth generation and long-term growth. If you can afford to lock in your investments for long periods you should consider investing in this service. Rule Breakers has a track record of success, easily beating the S&P 500 index and many other investment Newsletters in an 18 year period. The only consideration is that some of their plans can be a bit pricey – but even for that, you can purchase one of their bundles and access multiple services at a discount.