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Rachel Morey

12 Best Stock Picking Services for May 2022: Compare Returns

Rachel Morey
May 10, 2022

Full disclosure: We may receive financial compensation when you click on links and are approved for products from our advertising partners. Opinions and product recommendations on APYGUY are those of our writers and have not been influenced, reviewed or approved by any advertiser. Learn more about how we make money.

Many investors choose to pay for a stock-picking subscription to help them research potential investments. There are plenty of newsletters, stock-picking subscriptions, and investment information sites designed to help people who want to buy individual stocks make good decisions. 

Whether you are new to stock market investing or you just want to make more informed decisions without dedicating your free time to researching stocks, a subscription to a stock picking service or stock information website could provide the boost you need to build a profitable portfolio of growth stocks.

Top 12 Stock Picking Services, Subscriptions, and Websites of 2022

Below are the best stock picking services we’ve found and evaluated for May 2022. The services vary based on the type of investing and/or trading you intend to do.

Best Stock Picking Service for Long-Term Buy and Hold Investors: Motley Fool Stock Advisor

Motley Fool Stock Advisor is the company’s flagship service with over 1 million members and eye-popping returns for those with a buy and hold mindset.

Stock Advisor track record: In the last 17 years, Stock Advisor has performed roughly 3x better than the S&P 500.

Subscribers can see every recommendation offered by Stock Advisor throughout the entire history of the service.

What you’ll get with Stock Advisor: Access to the full history of Stock Advisor recommendations, “Starter Stocks” recommendations to help build a foundation of solid growth stocks in your portfolio, two new monthly stock picks, access to the service’s “10 Best Buys Now” list chosen from 300 stocks on the service’s watchlist, access to a community of like-minded investors.

Motley Fool Stock Advisor price: $199.99 per year. Now just $79 per year after a 30-day trial period! Limited time offer available in May 2022. This package normally costs $199.99 annually.

Best for: Investors who want to buy stocks in established companies with the intention of holding those investments for at least five years.

Motley Fool Stock Advisor may be a good fit for you if:

  • You prefer to buy and hold stocks
  • You want to invest in undervalued companies with a track record of success
  • You have money to invest at least $10,000 in the stock market and can continue to add new stocks to your portfolio each month

🤑 May 2022 Promotion: Join Motley Fool Stock Advisor for just $79/year for new members!

Best Stock Picking Service for Finding Undervalued Stocks: Motley Fool Rule Breakers

Motley Fool Rule Breakers is the second most popular stock picking service provided by the financial media company Motley Fool. They recommend stocks in emerging industries that have a sustainable advantage along with competent management. Rule Breakers’ advisors look for companies with strong consumer appeal that are currently undervalued. 

Rule Breakers Basics

Motley Fool Rule Breakers track record: Rule Breakers has a 15-year track record of beating the market.

What you’ll get with Rule Breakers: Starter Stocks list to help establish a portfolio, five “Best Buys Now” stock recommendations per month, and two new stock pick recommendations per month.

Motley Fool Rule Breakers price: $99 per year after a 30-day trial period.

Best for: Investors who want to consistently invest in growth stocks.

Motley Fool Rule Breakers may be a good fit for you if:

  • You prefer to buy and hold stocks
  • You have enough disposable income to invest in at least two new stocks each month
  • You are financially stable enough to invest and hold stocks for at least five years
Introductory Offer: Join Rule Breakers for just $99!

Best Stock Picking Service for Day Traders: Trade Ideas Premium Plan

The Trade Ideas Premium Plan uses an artificial intelligence (AI) assistant to help subscribers research potentially lucrative investments. The AI assistant runs more than one million simulated trades using over 70 proprietary algorithms each night before the markets open. 

Scan results, curated by real people before they become official stock picks on the Trade Ideas platform, include the method used to choose the stock, why it may perform well and how to find similar stocks. 

A live simulated reading room allows subscribers to see how the stock-picking service’s recommendations perform without risk. Users have access to real-time streaming ideas to facilitate skill-building. 

What you’ll get with Trade Ideas Premium Plan: Price alerts, Trade of the Week newsletter, five new trade ideas each Sunday night, Rules-based virtual trading room for active traders and long-term investors, fully-functioning AI assistant (Holly) that you can connect to your separate brokerage account to execute trades automatically.

Trade Ideas Premium price: $2,268 per year or Standard for $1068

Compare features below:

Best for: Long-term investors and day traders who want access to robust technology and also want to learn how to invest.

Trade Ideas Premium Plan may be a good fit for you if:

  • You have an established portfolio and plan to purchase larger volumes of stocks
  • You want to learn how to invest and trade using a simulated trading platform
  • You are comfortable allowing technology to execute trades on your behalf
  • You are currently engaged in day trading or are interested in learning more about how to become a successful day trader

Best Stock Picking Service for Fundamental Investors: Zack’s Investment Research Premium Subscription

Based in Chicago, Zack’s Investment Research offers constant monitoring of stocks to help investors decide whether to buy, hold, or sell individual investments. You can access the investment research software on Zack’s Investment Research site for free. Bull and Bear of the Day provide insights about two stocks (one Bull and one Bear) to help investors decide which stocks to hold or buy and which to sell. 

Zack’s rates stocks from one (strong buy) to five (strong sell) along with ratings for value and growth and momentum. Subscribers can enter their current stocks and funds to get up-to-date ratings 24/7. 

What you’ll get with Zack’s Investment Research: Focus List including long-term stock recommendations, Equity Research reports, Custom Stock Screener, and The Zacks #1 Rank List.

Zack’s Investment Research Premium track record: Stocks rated as a #1 Strong Buy beat the S&P 500 by more than 14% (on average) for the past three decades. Stocks rated as a #5 Strong Sell underperformed the market by 8%.

Take a look at Zack’s Strong Buy rated picks vs the S&P 500 over the last few years:

YearZack’s Strong BuyS&P 500
2022-7.14%-9.29%
2021+41.10+28.68
2020+33.86+19.27

Zack’s Investment Research Premium price: $249 per year after a 30-day trial

Best for: Fundamental investors

Zack’s Investment Research may be a good fit for you if:

  • You have an active portfolio and aren’t afraid to buy or sell stocks to maintain growth
  • Have the experience and knowledge needed to make independent decisions about your portfolio
  • Are willing to devote time and money to the pursuit of creating a profitable portfolio

Best Stock Picking Service App for Momentum Investors: Seeking Alpha App Premium Subscription

image credit: seekingalpha.com

Seeking Alpha’s app provides comprehensive investment news along with the opinions of thousands of experienced traders. Subscribers to Seeking Alpha’s Premium Tier app can opt into push notifications, email alerts, and texts to stay on top of breaking news in the world of stock market investing. 

Premium subscribers can create watch lists using the stock tracking portion of the app to get a custom feed. 

Seeking Alpha Premium App track record: Quant performance beats the market by four-to-one, stocks rated as very bullish created a 1,369% return over the S&P 500 and had an average annualized return of 29%. 

What you’ll get with Seeking Alpha Premium app subscription: Stock quant ratings, stock dividend grades, author ratings, author performance, unlimited access to all Premium content, watch list creation, news alerts, fewer ads than the free limited version of the app, and conference call transcripts.

Seeking Alpha Premium app price: $19.99 per month

Best for: Research-driven investors

Seeking Alpha Premium app may be a good fit for you if:

  • You want original stock news (not news-aggregator)
  • You want to interact with other investors about strategy
  • You base your investment decisions on ideas from other investors and original news

Read our full review of Seeking Alpha here.

Best Stock Picking Service For Technical Analysis: The Maley Report

The Maley Report offers no-frills information about stocks, including fundamental, macro, and technical analysis. Matt Maley has more than 35 years of experience trading on Wall Street and is now a market strategist at Miller Tabak + Co. Subscribers to The Maley Report have access to his analysis of what’s happening in the stock market.

What you’ll get with The Maley Report: Aggregates of Matt Maley’s videos, blog posts, and trade alerts, educational resources to help investors learn Maley’s strategy, a regular email newsletter with an overall outlook on the market and discussion of what’s to come.

The Maley Report price: $49 per month or $490 per year with a 30-day money-back guarantee

Best for: Fundamental and technical analysis investors

The Maley Report may be a good fit for you if:

  • You want actionable stock insights based on a number of factors
  • You want information from an experienced investor willing to discuss his methods for choosing high-performing stocks

Best Stock Picking Service For Day Traders & Swing Traders: Pilot Trading

image credit: pilottrading.co

Pilot Trading uses artificial intelligence to watch other day traders and swing traders in real time and make predictions about how the market may change from one minute to the next. Subscribers can create a custom watchlist or choose a pre-made one in the app. Link to a brokerage account to use the stock research app and make trades through the app.

What you’ll get with Pilot Trading: Information about real-time trading activity, alerts when market sentiment shifts, and the ability to link brokerage accounts. 

Pilot Trading price: $19.95 per month after a 14-day free trial

Best for: Forex, futures, crypto, and stock traders

Pilot Trading may be a good fit for you if:

  • You are an active trader interested in cryptocurrency investment, futures, or forex
  • You want in-app trading that connects to stock trading platforms

Best Stock Picking Service For Day Traders: Scanz

image credit: scanz.com

Scanz offers two ways to get information to inform day trading activity. The Scanz News Streamer offers SEC filing on NASDAQ, NYS, and AMEX alerts. It also provides two broker integrations and streaming charges. The Trade Scanner offers Level 1 and Level 2 data on NYSE, AMEX, and NASDAQ with unlimited watchlists, a montage window, streaming charges, and breakout alerts. 

Subscribers can choose between the services or bundle them to get a discount.

What you’ll get with Scanz: Access to customized alerts for price changes, percentage changes, volume changes, and important company news.

Scanz price: $79 per month for news only, $99 per month for scanner only, $149 per month for news and scanner; seven-day free trial.

Scanz may be a good fit for you if:

  • You are an active day trader who wants up-to-the-minute breaking news that’s curated to help you reach your goals
  • You want to filter stocks based on a predetermined set of criteria, including penny stocks

Best Stock Picking Service For Penny Stocks: Tim Alerts

Tim Alerts is a platform created by Tim Sykes. The successful penny stock investor started with just $12,000 and in about ten years became a multimillionaire. Sykes started Tim Alerts to help penny stock investors learn how to make money in the stock market by purchasing penny stocks. The platform provides finance services, training for retail investors, and educational content. 

What you’ll get with Tim Alerts: Access to a chat room with a paired trading app, daily penny stock picks newsletter with stock watchlists, and customizable push notifications.

Tim Alerts price: $679 per year

Best for: Penny stock traders

Tim Alerts may be a good fit for you if:

  • You are curious about investing in penny stocks and want to learn from someone with documented and ongoing success
  • You want daily stock picks delivered to your inbox
  • You learn best by interacting with other investors 

Best Stock Picking Service For Income Investing: AAII Dividend Investing

image credit: invest.aaii.com

AAII Dividend Investing provides direction to investors who want to build a portfolio of dividend-paying stocks. The platform provides subscribers with research and information produced by its proprietary stock picking process. AAII searches for and highlights stocks providing a mix of asset and yield quality. It also looks closely at recommended company’s management teams to make sure that the stock is likely to pay out dividends for years to come. 

What you’ll get with AAII Dividend Investing: Access to a target portfolio with a mix of Geographical Exposure and GISC Sector investments, weekly webinars, and access to weekly stock ideas and the lead analyst.

AAII Dividend Investing price: $2 for the first 30 days and then $199 per year or $359 for two years

Best for: Dividend investors

AAII Dividend Investing may be a good fit for you if:

  • You want reliable information about low-risk dividend-paying stocks
  • You want instant access to the information you need to build a portfolio with fully vetted dividend stocks

Best Stock Picking Service For Swing Trading: Mindful Trader

image credit: mindfultrader.com

Mindful Trader helps swing traders make confident decisions about when to buy and sell stocks. Short-term movements in the stock market can be hard to follow, even for devoted traders. Mindful Trader offers up to 15 text or email alerts each week to help traders manage an active portfolio of investments. 

What you’ll get with Mindful Trader: Stock trade alerts via text and email, between five and 15 trade alerts each week, clear guidance about when it may be smart to open or close positions, and historical data on every recommended trade since Mindful Trader’s inception.

Mindful Trader price: $47 per month; cancel anytime

Best for: Swing traders

Mindful Trader may be a good fit for you if:

  • You want an easy way to take advantage of quick movements in the market
  • You want access to live positions in a portfolio with historical data

Best Stock Picking Service For REIT Stocks: Millionacres Real Estate Winners

image credit: millionacres.com

Investors involved in real estate investing and REITs may find that the valuable and condensed information included with a Millionacres Real Estate Winners subscription helps them level up their investing game. 

Millionacres Real Estate Winners aims to help investors understand the complicated world of real estate investment with recommendations and stock picks to help you create a portfolio of money-making stocks. 

What you’ll get with Millionacres Real Estate Winners: Investing ideas with guidance on how to get started in the real estate market, monthly new stock recommendations, updates on previously recommended stocks, “Top 10 Investment Alerts” quarterly, unlimited access to education resources on the Millionacres site. 

Millionacres Real Estate Winners price: $149 per year 

Best for: Buy and hold REIT investors and those curious about getting started with REITs

Millionacres Real Estate Winners may be a good fit for you if:

  • You are a beginning investor interested in making successful REIT trades
  • You are an experienced investor seeking bit-sized monthly investment alerts about real estate equities and REITs to support your current trading activity
  • You want to use real estate investments to create a portfolio that produces consistent and reliable results for years to come.

Why Subscribe To A Stock Picking Service?

Paying for advice about which stocks to pick can be a great time saver. It’s crucial that you trust your source of information, however. Subscribing to a stock picking service requires an investment, which can be tough to justify if the service doesn’t have a long and dependable track record of choosing up-and-coming companies. 

To get your money’s worth, you’ll need to take the service’s advice and buy the stocks they recommend. Stock picking services make the most sense for investors who already have some money in the stock market and have the extra money and confidence it takes to buy individual stocks. 

Even with a stock picking service, you’ll need to know enough about how the stock market works to determine whether a specific stock is a good fit for your portfolio. If you are new to buying stocks, it’s wise to spend time learning about how other investors research stocks. The Khan Academy offers a great deal of free and unbiased education about stocks and bonds in their Finance and Capital markets section. 

What To Look For In A Stock Picking Subscription

🥇 Track record: The stock picking service should produce returns for subscribers that purchase recommended stocks. Look for how the service’s choices performed compared to a benchmark index. Growth stocks should perform over time. 

💸 Price: Some stock picking services cost thousands of dollars each year. Look for a modestly priced service; not one that you couldn’t cover the cost of with gains from your portfolio. 

📈 Results you can reproduce: Some of the best-performing investments aren’t available unless you are an institutional investor. They may be able to buy stocks at a lower price before it goes public. If you can’t reproduce the results in your portfolio, the service has no value to you. 

📚 Education: A good stock picking service doesn’t just periodically send you the names of stocks to buy. You should gain knowledge when you read about how and why they chose a specific stock. The service should help you build the skills you need to evaluate recommendations based on your unique criteria, investment goals, and risk tolerance. 

Bottom Line

Stock picking services should help you build the skills you need to make independent decisions about your portfolio. Even if you only subscribe to a single stock picking service, it’s wise to gather information from a number of sources before you decide to buy or sell any single stock. Many of the services listed here offer free information and resources. Always research stock picks on your own and make sure they are a good fit for your portfolio. 

If you decide to try out a stock-picking service, take full advantage of the service during the free trial (if there is one) before you commit.

Filed Under: Investing Tagged With: Seeking Alpha, The Motley Fool

Morningstar Review: Is the Premium Service Worth It in 2022?

Rachel Morey
April 28, 2022

image credit: morningstar.com/premium

Subscribing to a stock advice service through a well-known company like Morningstar is a smart way to spend less time researching stocks while building a portfolio of high-performing investments. 

Morningstar provides ratings for mutual funds. Morningstar Premium subscribers get unlimited access to the platform’s research tools, fund costs and fees analysis, a robust fund screener tool, and updated ratings at a cost of $199 per year after a 14 day trial.

If you don’t want to make researching and choosing mutual funds your full-time job, you can rely on a platform like Morningstar to give you ideas about which investments may produce the best long-term results. 

What is Morningstar?

image credit: morningstar.com

Founded in 1984, Morningstar is a Chicago-based investment research firm. The company provides mutual fund evaluation tools and ratings to support investors as they build their portfolios. The company has more than $220 billion in assets under management. 

Morningstar Rating for mutual funds started in 1985. It’s now the much-enhanced Morningstar Premium stock advisor service. 

Morningstar Basic offers some access to portfolio management tools and screeners. With Morningstar Premium, subscribers gain access to Top Investment Picks, Analysts Reports, portfolio management tools, and screeners.

Morningstar is a source for unbiased analysis, commentary, research, and insight. They aren’t a stock buying platform. To take advantage of their advice, you’ll need a brokerage account. 

The Financial Industry Regulatory Authority (FINRA) uses Morningstar to analyze mutual funds. FINRA offers investor education materials and tools in their Market Data Center. In 2013, they started using Morningstar’s financial data and technology to relaunch the FINRA Data Center. 

How Does Morningstar Choose Funds to Recommend?

Morningstar likes funds with low expense ratios run by managers who invest their own money into the fund. They give preference to firms with a stable corporate culture. Morningstar’s rating history shows that these criteria are excellent predictors of a successful fund. 

Are Morningstar Stock Picks Any Good? 

Morningstar’s gold-rated diversified U.S. stock funds, managed by the firm’s team of more than 100 fund analysts, beat Standard & Poor’s 500-stock index by an average of .03 percentage points each year over the past ten years. 

Morningstar’s gold-rated diversified developed-market foreign stock funds:

  • 9.1% average annualized rate of return (as of 2021)
  • Beat the MSCI EAFE index by 2.0 percentage points per year

Morningstar’s gold-rated intermediate-term bond funds:

  • 5.6% average annualized rate of return (as of 2021)
  • Beat Barclays Aggregate U.S. Bond index by 0.6 percentage point per year

Average Morningstar pick U.S. stock funds:

  • Came in behind the S&P 500 for the past three years
  • Came in behind the S&P 500 for the past five years

According to Russ Kinnel, Morningstar’s director of fund research, actively managed funds have found it challenging to keep up with the stock market’s dramatic ascent over the past few years. 

Here is a sample of how three of Morningstar’s gold-rated funds have performed over the years:

Dodge & Cox Income (DODIX):

  • Expenses: 0.43%
  • Dodge & Cox Income returned an annualized 6.4% compared to Barclays U.S. Aggregate Bond Index through July 18, 2021. 

The majority of this fund is invested in government-backed mortgage securities and investment-grade corporate bonds. Since bond prices and rates tend to move in opposite directions, the fund is susceptible to interest rate increases. The fund’s price will hypothetically fall 4.5% if interest rates go up one percentage point.  

LKCM Equity (LKEQX):

  • Expenses: 0.80% 
  • LKCM Equity beat the S&P by an average of 0.8% per year with average annualized gains of 9.0% over the past ten years (2011 – 2021).

Manager Luther King uses consistent strategies to choose stocks for this Fort Worth-based fund. Since 1995, this fund has shown solid returns. King, his co-managers, and analyst team focus on large companies with high returns on equity and strong cash flow selling at low prices. 

Primecap Odyssey Stock (POSKX):

  • Expenses: 0.63%
  • Primecap Odyssey Stockbeat the S&P by an average of 1.7% per year with average annualized returns of 9.8% since the fund’s inception in 2004 (as of 2021).

Los Angeles-based Primecap Management has three funds, and this is the quietest option. The fund looks like Vanguard Primecap (VPMCX), which has produced admirable results since its 1984 launch. Vanguard Primecap is closed to new investors. 

More than half of Odyssey Stock’s assets are in technology and health care. Nearly all assets are in well-established companies. The fund’s performance varies wildly from the S&P 500, following the trajectory of tech and health sectors. 

Morningstar Review: A Warning About Morningstar’s Star Rating System

Morningstar assigns a one-to-five-star ranking to each mutual fund or ETF. Metrics are risk-adjusted and relative. The platform groups funds with similar assets then compares performance to achieve a peer-adjusted rating. 

The Morningstar system of rating mutual funds depends on past returns. They don’t take outliers into account. When a fund manager has an unusually bad or good year, those numbers can skew the averages. The star system does not account for whether the fund has consistent leadership or whether managers frequently come and go. 

Morningstar offers its subscribers warnings about not depending heavily on star ratings when making investment decisions. Many investors who purchase shares of mutual funds intend to hang on to those funds for decades. It’s worth noting that many highly rated funds in 2004 lost their favorable ratings by 2014. In addition, many low-rated funds went on to produce excellent returns over time. 

The firm’s ratings seem to have a measurable effect on investment flow. Strategic Insight notes that four-star and five-star funds enjoyed a net positive investment flow each year between 1998 and 2010. Funds with one-star to three-star ratings suffered negative investment flow every year during the same period. 

Details About Morningstar’s Premium Subscription Services

Morningstar Premium may work best for investors actively managing their portfolios. Choosing investments, allocating assets, and diversifying a portfolio can be time-consuming and stressful. Morningstar Premium allows investors to take a DIY approach with support from experts with a long track record of success. 

Morningstar Premium Basics

  • Cost: $0 for Morningstar Basic, $199 per year for Morningstar Premium after a 14-day trial
  • Services: Ratings, stock picks, stock research, commentary, analysis, investment tracking
  • Types of securities: ETFs, mutual funds, bonds, stocks
  • Funds analyzed: 4,000

Morningstar Ratings

A Morningstar rating offers a one-to-five-star rating of a fund based on its risk-adjusted return relative to funds in the same category. 

Ratings are generated by mathematical measurement only and consider the level of risk and how well a fund performed in the past. 

Morningstar divides funds into four categories. A five-star rating goes to only the top 10% of funds in the category. Four-star ratings go to the next 22.5% of funds in the same category. Three-star ratings go to the next 35% of funds. 

Morningstar’s star ratings use information from past performance only. Since past performance does not guarantee future success, investors should consider that limitation when evaluating funds using star ratings. 

Investment Tracking

The Portfolio X-Ray Tool provides investors with a means by which to enter investments manually. The tool uses each fund’s quarterly SEC reports to determine asset allocation across an entire portfolio. 

Screeners

The Premium Stock Screener offers investors the ability to zero in on investments as they evaluate stocks, ETFs, and mutual funds. 

The SG Screener helps investors find investments that meet their governance, sustainability, and environment guidelines within parameters that include minimum Morningstar ratings. 

Analyst Insights and Stock Picks

Analyst Insights offer reports with in-depth summaries of morningstar analysts’ opinions of specific investments. Summaries include forward-looking assessments as well as comparisons to the investment’s Morningstar category and benchmark. 

Morningstar Pros and Cons

Pros:

  • In-depth research covers stocks, ETFs, bonds, and mutual funds
  • Help to choose the best funds and stocks with Best Investments lists
  • Multi-year subscriptions come with a discount
  • Information on more than 620,000 investments
  • The customizable interface is easy to navigate

Cons:

  • Premium content is behind a paywall
  • Month-to-month subscription costs as much as $359/mo
  • Star ratings based only on past performance
  • Screener tools are not intuitive
  • Heavy focus on mutual funds – not as helpful in comparing individual stocks, bonds, or ETFs

Morningstar Customer Reviews

Read reviews from current and past subscription customers before you jump into paying for any stock advising service. Look for online reviews from verified customers on reputable sites like the Better Business Bureau (BBB) and Trustpilot. 

There are few customer reviews other than those published by the investing platform as part of their marketing plan. Keep in mind that many customers who enjoy the service and don’t have complaints may not take the time to write a review. It’s more likely that unsatisfied customers will spend time looking for third-party review sites where they can leave bad reviews. 

Morningstar Suffers on Trustpilot

Morningstar has just 60 reviews on Trustpilot with an overall rating of 1.9 stars out of 5. See the breakdown below:

  • Excellent: 7%
  • Great: 3%
  • Average: 8%
  • Poor: 12%
  • Bad: 70%

“I have been a morningstar premium subscriber for ten years. The analysis and data is good enabling you to track your portfolio performance. Sadly the customer support is not premium.”

-Chris Stephens

Customer complaints center around Morningstar’s premium membership and not that the tools did not work correctly. Customers who wrote reviews on Trustpilot also noted that customer service wasn’t helpful when they had problems signing up for the premium service, canceling their subscription, or resetting a password. 

Morningstar on the BBB Website

Morningstar Inc. has only received a handful of reviews over the years on the Better Business Bureau (BBB) website. Morningstar’s customer service team has responded to and closed a total of 10 complaints in the last 3 years and 3 complaints in the past 12 months. 

Details About Morningstar’s Free Basic Services

Morningstar members who register for a basic account get access to a few decent stock research tools through the platform. Morningstar Basic comes with unlimited access to the site’s article archive and limited access to screeners, portfolio x-ray, and portfolio manager. Basic members do not get to see top investment picks or analyst reports. 

Upon initiating a basic membership with Morningstar, new members can choose to get a free issue of Morningstar FundInvestor and a free issue of Morningstar StockInvestor. 

How to Get Started With Morningstar Premium

It takes less than 30 seconds to set up a free account on the Morningstar platform. New Basic members have the opportunity to evaluate the Premium tier of services for 14 days, after which they can keep the membership for $30 off of the regular price. The prices (including the discount) are as follows:

  • One year: $249 but currently discounted to $199
  • Two years: $399
  • Three years: $499

Morningstar Premium members can also choose a one-month automatically renewing subscription. Billing starts after the 14-day trial. 

Is Morningstar Premium Worth it? 

Morningstar Premium could be worth it for investors that want to choose mutual funds to add to their portfolio of investments. Investors who are less interested in mutual funds than in bonds, stocks, and ETFs, may find that other subscriptions to investment advice newsletters and stock picking websites are a better use of their money. 

It’s worth mentioning again that Morningstar is not a brokerage. If you want to invest in the funds recommended by Morningstar’s Basic or Premium subscription, you’ll have to open a brokerage account.

Filed Under: Investing Tagged With: Morningstar

Yieldstreet Review 2022 – 9.71% Avg Annual Returns

Rachel Morey
April 21, 2022

image credit: yieldstreet.com
Full disclosure: We may receive financial compensation when you click on links and are approved for products from our advertising partners. Opinions and product recommendations on APYGUY are those of our writers and have not been influenced, reviewed or approved by any advertiser. Learn more about how we make money.

Yieldstreet is an online investment platform that offers several alternative investments options.

With Yieldstreet one can invest in marine projects, art, real estate, litigation deals, and commercial loans like merchant cash advances.

Most of the assets available through Yieldstreet are open to accredited investors only. Their Prism Fund, which launched in August 2020, is available to non-accredited investors with a minimum investment of $500.

While competing alternative investment and real estate investment sites allow investors to buy a portion of a block of commercial real estate properties, Yieldstreet crowdfunds debt that finances those (and other) deals.

The company’s first offering rolled out in 2015 in litigation finance, pairing investors with plaintiffs who need a loan to cover lawsuit expenses before the settlement. 

While there’s always a risk of default, Yieldstreet investors can earn interest payments and eventually receive a principal return over the investments’ life.

You can learn or get started on YieldStreet’s website here.

What is Yieldstreet?

Yieldstreet is an online platform that allows investors to participate in crowdfunding a variety of alternative investments backed by several asset classes, including real estate. Investing with Yieldstreet may provide passive income and allow diversification of portfolios to reduce correlation to the stock market. 

Qualified Yieldstreet investors can choose from short-term investments (fund options, equity deals, etc.) with a maximum term of three years. 

Yieldstreet employs experts in every asset class offered on the platform, and they vet the sponsors and originators who want to list on the platform as well as the deals offered to investors. Retail investors may not have the knowledge necessary to properly evaluate the deals offered on Yieldstreet, so it’s crucial that there are experts on staff there who can make sure that investors get access to high-quality deals. 

Yieldstreet favors investment opportunities with the following characteristics:

  • Low minimums
  • Short durations
  • Target 8%+ yield
  • Low stock market correlation

There are risks associated with investing in debt, even if assets secure it. A higher potential reward attracts investors willing to take a chance, but hopefully, investors realize that they may lose money with Yieldstreet. 

Yieldstreet backers include Citi (NYSE: C); the company plans to use Yieldstreet to invest $2 billion for wealthy clients. Billionaire philanthropist George Soros is also backing Yieldstreet. 

Yieldstreet Pros and Cons

✅ Pros:

  • Access to alternative investments including art, real estate, lawsuits, debt, etc.
  • Individuals can invest in privately structured credit deals
  • Open to non-accredited investors.
  • Tangible assets back each investment.
  • Easy to use platform.
  • Can be managed online or through mobile apps.

🛑 Cons:

  • Illiquid investments.
  • Many investments are available only to accredited investors.
  • Higher fees than competing platforms.
  • Consumer complaints and customer ratings raise concerns.

You can learn or get started on YieldStreet’s website here.

How Does Investing With Yieldstreet Work?

To invest with Yieldstreet, users look for a deal on the platform that interests them. They can search by asset type, loan term, and net yield parameters. Investments are a loan to the asset owner, with the asset serving as collateral for the loan. 

Most of the investments available on the Yieldstreet platform are for accredited investors only. Accredited investors must meet the following criteria:

  • Minimum net worth of $1 million, excluding the value of a primary home
  • Minimum annual income of $200,000 ($300,000 for couples filing jointly) with the expectation that current income will continue. 

Prism Fund Investment Requirements

The Yieldstreet Prism Fund is available to non-accredited investors as of late 2020. Retail investors can access multiple investment opportunities across several asset classes in a single fund.

Minimum investments for the Prism Fund are $500, which is much lower than Yieldstreet investments reserved for accredited investors. 

How Yieldstreet Sources Investments

Yieldstreet investors lend money through the platform and make a return on the yield borrowers pay. Yieldstreet charges fees to manage the loan, collect payments from borrowers, and distribute funds + interest to borrowers. If a borrower defaults on their loan, Yieldstreet works to recover the investors’ funds. 

Minimum Yieldstreet Investment

Certain investments on the Yieldstreet platform require an initial investment as low as $10,000. These investments are likely Borrower Payment Dependent Notes. Special Purpose Vehicles (SPVs) structured as LLC subsidiaries of the platform are owned by investors, and minimums may be higher for SPVs. 

Short-term note options have a $1,000 minimum investment requirement.

How Investors Keep Tabs on Their Account

Investors can check their portfolios on the Yieldstreet platform to understand how their specific investments perform over time, the amount of money earned so far, and progress toward the fund’s goals. Yieldstreet sends every investor monthly and quarterly statements and updates any time there’s new activity with their investments. 

What You Should Know About Yieldstreet Before Investing

Investment minimums: Yieldstreet states on their website that the typical minimum investment is $10,000. However, deals in the past have offered minimums of $5,000, and some reach a $60,000 minimum requirement. 

Type of investments: Yieldstreet investments are debt-related, and investors lend money to the platform to fund high-risk loans in various sectors. Fortunately, the loans are secured by property, which reduces the financial risk if a borrower defaults. 

Yieldstreet platform: Investments featured on the website include details like the minimum and maximum investment accepted, expected annual return, duration of the investment, the total offering size, and information about why Yieldstreet recommends the investment, any associated risks, expenses, and projected repayment schedule. 

Asset-based investing: Yieldstreet investments are backed by underlying assets, which helps protect investors from losing the money they invest on the platform. 

Fees: Annual management fees range from an average of 1% to 2.5%. There may also be an originator listing fee. Certain investments have an annual fee of $100 to $150 during the first year and $30 to $70 in subsequent years. Expenses come out of initial interest payments. 

Self-directed IRA option: Investors can choose to participate in Yieldstreet’s opportunities through a self-directed IRA. The custodian broker is IRA Services. 

Liquidity: Yieldstreent investments can’t be cashed out at any time during the target duration. 

Investments have limited availability: Investments are open for a set period of time and are first-come-first-served. 

Are Yieldstreet Investments Any Good?

source

Yieldstreet has a 7% to 12% target rate of return.

To put this into perspective, private investment vehicles had an internal rate of return (IRR) of 9.71% across all investments between 2015 and 2021 after the deduction of expenses and management fees. This is down from ~11.0% across all investments in February 2022 when we last surveyed their investor returns.

Investors have entrusted Yieldstreet with $2.3 billion since the company’s inception. As of early 2022, the company has returned nearly $1.35 billion of capital to investors, $189 million of which is interest. In 2020, Yieldstreet appeared on the 2020 Inc. 5000 and was ranked number 46 on the list, a collection of the fastest-growing privately held companies in the United States. 

As of January 2022, more than 350,000 people have joined the platform. Each investor requests on average 6.5 different investment vehicles to spread their funds across.

Yieldstreet has experienced some challenges, and it’s willing to go after borrowers if they default on loans. In 2020, the company won a $77 million judgment in U.K. courts. A vessel deconstruction project didn’t go as planned, and the borrower defrauded numerous investors, including Yieldstreet. The lawsuit allowed the company to seize assets in an attempt to return investors’ money as promised.

Assuming economic conditions remain strong, investors with Yieldstreet could reasonably expect the company to continue to make profitable loans yielding the promised rate of return. If borrowers default, the company is expected to continue to make every effort to recoup their investors’ money. 

Several deals on Yieldstreet are short-term, with projected high-interest yields. Each deal on Yieldstreet has unique risks, however. Lower-than-average minimum investment amounts for nonaccredited investors may attract those who have less than $1 million in the bank but want to get involved in non-traditional deals. Building a diversified collection of loans could help reduce the overall risk of default resulting in permanent losses. 

A Note About Yieldstreet Liquidity

Yieldstreet investments are illiquid, and each individual investment opportunity has a term of 180-days to four years. Like other crowdfunded investments, it’s not possible to pull money out of the investment before its end date. 

The Prism Fund has a duration of 48 months. During this time, investors can’t liquidate their assets and receive a return of capital. It may take up to one year after the fund’s end date for investors to receive their capital plus interest. Certain investments offer limited liquidity every quarter, however. 

Yieldstreet vs. REITs

Investors interested in the real estate market can buy shares in real estate investment trusts (REITs) or invest directly through a platform like Yieldstreet. REITs allow investors to buy and sell stock quickly, just like investing in any other stock. Even so, like the investments on the Yieldstreet platform, much of the REIT market is reserved for institutional investors. 

Yieldstreet investments are illiquid; investors must wait until the target date attached to the specific investment to gain access to their money plus any interest it earned. Target dates aren’t guaranteed, however, and investors may end up waiting longer than they planned to access their investment funds. REITs provide instant liquidity, restricted only by the stock market’s operating hours. 

REIT values fluctuate according to the stock market, while alternative investments like Yieldstreet offerings are largely unrelated to stock market activity.

Yieldstreet vs. Competitors

Here are some of the other big players in the online alternative investment world and their annual returns to investors since inception.

Keep in mind, these online platforms primarily provide passive real estate investment products.

FundriseCrowdStreetDiversyFundYieldstreet
201412.25%NRNRNR
201512.42%NRNR9.71% avg
20168.75%NRNR9.71% avg
201711.44%NR18%9.71% avg
20189.11%NR17.3%9.71% avg
20199.47%NRNR9.71% avg
20207.42%17.7%NR9.71% avg
202122.99%NRNR9.71% avg
NR = Not Reported

Not all real estate investment platforms are alike, so be sure to research them each individually before making a decision.

Yieldstreet Fees

Yieldstreet doesn’t impose trading fees, commissions, or inactivity fees, which may be attractive to investors who want to diversify but don’t want to get hit with a ton of fees. The annual management fee ranges from 1% to 2% of assets. Prism Fund investors pay an annual administrative fee of 0.50%. 

Flat annual fund fees vary according to the investment and are deducted from initial contributions. Expect a $100 yearly fee for Special Purpose Vehicles during the first year and $70 for subsequent years. Borrower Payment Dependent Note investors pay $150 during the first year and $30 for the following years. 

Short-term notes don’t have fees. 

Each investment’s fees are detailed on the deal page. Yieldstreet may impose a listing fee or deal origination fee, as well. For example, the Prism Fund has a 1% annual management fee with a maximum annual administrative fee of 0.5%. The Aviation Fund has a 0% to 0.25% management fee and a 0% to 2.5% incentive fee. 

Because the fees vary for each investment, it’s crucial to evaluate each option and understand the fees before proceeding with an investment. 

Is Yieldstreet Worth it For New Investors?

Maybe. New investors who have a solid portfolio and want to diversify should fully understand how Yieldstreet works before committing to an investment. They should understand that they may not get their investment back for several years, and there’s a risk of losing their money. 

Understanding Crowdfunded Debt

Yieldstreet has several resources designed to help new investors understand how crowdfunded debt could produce returns. This information is available to potential investors even before they create an account. After opening an account, detailed information about each asset class and individual investments is readily available, as well. 

Yieldstreet Customer Reviews

Yieldstreet doesn’t fare so well in customer reviews. There are only a few reviews on Trustpilot, and they are generally negative. Many customers who wrote reviews on various platforms seem disappointed with their inability to get their money out of the investment before the target end date. They didn’t seem to understand the terms of the investment with Yieldstreet. 

Yieldstreet on the BBB Website

Yieldstreet has an F rating on the Better Business Bureau (BBB) website, with 20 user reviews. Yieldstreet reviewers gave the investment firm an average of 2.05 stars out of five stars. Many negative reviews point out that an advertised $200 bonus was difficult or impossible to receive from Yieldstreet. 

Here are two reviews that may help you decide whether to invest with Yieldstreet:

July 21, 2021

“As a retired hedge fund manager who invested in equities and distressed debt, I had high expectations for what YieldStreet should be, and I have been very impressed. The investments have worked, and my returns have been exactly what I expected. They provided help along the way, from detailed deal memos and access to YS analysts, to simplified tax reporting and, most importantly, an easy and friendly mobile app. I have been very happy. My only gripes would be that the timing and attractiveness of the new offerings have been choppy, and I prefer single-name investments over blind pools, but a lot of the recent offerings have been funds…”

-Kevin L. 

July 12, 2021

“I’ve been an investor with Yieldstreet for 3-4 years now. They are, in my view, a responsible investment firm offering very favorable, secured returns for Accredited Investors.. Yieldstreet offers the opportunity to invest in secured bridge loans as well as an increasing number of other related investment funds and vehicles normally available only to institutions and very high net worth individuals, earning 7-11% interest or higher. At the moment, I’ve put more than 50% of my investments into it, a reflection of the poor returns of conventional fixed investments, and an overpriced equity market. However, this is definitely not for everyone, which is my main reason for not rating 5 stars..”

-Keith

Yieldstreet on Reddit

Reddit users are not fans (in general) of Yieldstreet. They are suspicious of the investment quality offered by the platform and seem to prefer other investment options. 

“I have experience with YieldStreet and FundRise, and my advice is to steer clear of any startup promising high returns and low risk. Go with a mutual fund or stable dividend stocks (4%+ yield) like Verizon. The reality of platforms like YieldStreet is that you’re getting the bottom of the barrel – I’ve already had two YieldStreet investments go into default because they deal with shady companies that can’t get funding elsewhere.”

-Absolutboss

The whole appearance of every loan is ‘we worked hard to get Yieldstreet members a chance to participate in this high quality, private investment opportunity!’ The truth is actually ‘no one else would loan them money because it’s so risky so they came to us'”

-dinedal

Yieldstreet Customer Service

Investors requiring assistance can contact Yieldstreet customer service by emailing investments@yieldstreet.com or call the company at 844-943-5378. The site doesn’t have a live chat feature, but representatives aim to return emails within 24 hours. 

Is Yieldstreet Worth it? 

Yieldstreet provides individual investors with a means by which to invest in privately structured credit deals. The platform offers the unique opportunity to diversify into offerings typically reserved for institutional investors. 

Not all loans through Yieldstreet have performed well for investors. Overall, the platform has a solid track record of generating passive income backed by alternative assets. 

Investors who understand alternative asset classes, have discretionary income to spend on the investment, and are comfortable with illiquid investments, may find that Yieldstreet provides access to the type of diversification they want.

You can learn or get started on YieldStreet’s website here.

Filed Under: Real Estate Investing Tagged With: Yieldstreet

Top 8 Real Estate Crowdfunding Platforms for 2022

Rachel Morey
April 4, 2022

Real estate crowdfunding provides investors with a new way to diversify their portfolios by investing passively in real estate.

Some crowdfunding sites offer non-accredited investors access to investments that may have previously been available only to wealthy or knowledgeable individuals.

Real estate investing (like many other types of investing) is risky. Real estate investments don’t necessarily follow the ups and downs of the stock market, which is part of their attraction. In a portfolio with many different investment types, real estate could help protect investors from the stock market’s volatility.

Investors who would like to experience the potential advantages of real estate investing without having to finance, own, and manage properties may find the idea of real estate crowdfunding appealing. Even though real estate crowdfunding is relatively new, several real estate crowdfunding platforms have a track record of producing good returns for their investors. 

The platforms listed here are in alphabetical order. There are many differences between the platforms identified here. Each may be “best” for certain investors, so we’ve identified the type of investor that may find the platform most appealing.

What Is Real Estate Crowdfunding?

Real estate crowdfunding allows individual investors to pool their resources with other investors to amass a large amount of money quickly. Crowdfunding sites facilitate investments by gathering money from multiple investors to fund a single investment opportunity. Each investor receives a return that’s in proportion to the amount of their investment. If there’s a loss, the investors share that misfortune, as well. 

Investors benefit from real estate crowdfunding because it offers exposure to potentially lucrative investments that may be otherwise unaffordable. Many platforms provide automatic investing, which decreases the amount of time individuals must spend researching, vetting, and executing specific investments. Distributions or lump sum returns provide the potential for good returns from real estate crowdfunding investments. 

It’s crucial to understand that if you decide to get involved with real estate crowdfunding, your money could be tied up for three to five years. This type of investment can be high risk when compared to other investments. Depending on the platform and investment, fees could be high, as well. Some investment platforms work only with accredited investors. 

How Does Real Estate Crowdfunding Work?

Real estate investment platforms connect investment opportunities with funding. Most real estate crowdfunding deals have a sponsor, a crowdfunding platform, and investors. 

Here’s a brief explanation of how real estate crowdfunding platforms work:

  • The sponsor acquires, manages, and eventually sells the investment. They are an individual or a company that takes responsibility for the entire project. 
  • The crowdfunding platform makes connections between the sponsor and potentially interested investors. It handles regulatory issues, explains the terms of available deals to investors, and collects money from investors. 
  • The investors offer money to fund the project in exchange for a share of the potential profits. 

The Best Real Estate Crowdfunding Sites of 2022

  • Best for Accredited Investors & Transparency: CrowdStreet
  • Best REITs: DiversyFund
  • Best for Low Fees: EquityMultiple
  • Best for Non-Accredited Investors: Fundrise
  • Best for Investing in Loans: PeerStreet
  • Best for Property Research: RealtyMogul
  • Best for Short Terms: Groundfloor
  • Best for Rental Income: Roofstock

CrowdStreet: Best for Accredited Investors & Transparency

PlatformAvg. annual returns
CrowdStreet19.0%

CrowdStreet offers accredited investors direct access to commercial real estate investment deals. Potential investors can review, compare, and choose individual deals that meet their investment criteria. More than 100,000 accredited investors across the United States have used the CrowdStreet platform to facilitate their real estate investments. 

CrowdStreet has managed funds. Advisory services offer transparent access, and the platform makes it easy for investors to get involved in potentially lucrative deals outside of the stock market. 

CrowdStreet fees range from 0.50% to 2.5% for CrowdStreet funds. Other funds are also available on the platform, and their fees vary by offering. There’s a minimum $25,000 investment required. Average annual returns are 19% as of 2022. Investors who choose to participate in a CrowdStreet investment deal may experience much lower or higher returns than the average 17.3% returns. 

Choose from individual institutional-quality real estate deals or a professionally managed portfolio. 

CrowdStreet’s headquarters are in Portland, Oregon. The company was founded in 2014 and has been very transparent with their numbers and annual investor returns. As of February 2022, Crowdstreet has invested over $2.8 billion with over 580 deals funded and $464 million paid in distributions to investors. As of 2022, 95 investments have been fully realized (sold) with 2 being realized this year so far.

Pros

  • A helpful chatbot helps users navigate the platform 
  • Institutional-quality offerings
  • Investment deals are easy to find after you sign up for an account

Cons

  • Open to accredited investors only
  • High investment minimums
  • Early withdrawals prohibited

DiversyFund: Best for REITs

PlatformAvg. annual returns
DiversyFund17% – 18%
Returns based on 2017-18 data.

Investors become co-owners in a portfolio of real estate assets with their first investment on the DiversyFund platform. The DiversyFund team finds, vets, and creates access to properties with a high potential for positive investment returns. They sell the assets, split profits among investors, and reinvest cash flows to create even more wealth. 

Unlike similar platforms, DiversyFund actually purchases properties. They require a low minimum investment of just $500 for the DiversyFund Growth REIT, and you don’t have to be an institutional investor to get involved. However, investors never pay management or broker fees, and there is usually a 2% to 8% developer fee. Average annual returns across all investments on the DiversyFund platform range from 17% to 18%, based on 2017 and 2018 data.

Pros

  • Investors never pay management fees
  • Mobile app (unique among real estate crowdfunding platforms)
  • Low $500 minimum investment

Cons

  • Limited choices among investment types
  • Early withdrawals are prohibited
  • Investors receive payment at the end of the investment term

EquityMultiple: Best for Low Fees

PlatformAvg. annual returns
EquityMultiple16.8%

EquityMultiple has a straightforward three-step process that allows investors to access institutional-quality opportunities quickly.

  1. Create a free account to see the details of each property. Review EquityMultiple Marketplace deals to locate one that lines up with investing goals. 
  2. Choose an investment amount and submit an investment offer. E-sign the appropriate documents for EquityMultiple approval and fund the offer. 
  3. Monitor the direct equity in commercial real estate property via the EquityMultiple online portal. Get updates from the property sponsor, choose a distribution method, and manage tax documentation from the main dashboard. 

EquityMultiple charges a 1% fee on equity investments, and other fees depend on the terms of the individual investment. There may also be origination fees associated with fund offerings. The minimum investment amount is $5,000, and participants must be accredited investors. 

Previous investors with EquityMultiple experienced average annual returns of 16.8%. Since this is an average across all investment types, it’s possible to receive a much lower or higher return if you decide to invest with EquityMultiple. 

The platform provides access to commercial real estate deals, including senior debt, equity, and preferred equity. Investors can also participate in tax-advantaged deals like Opportunity Zones and 1031 exchange investments. 

Distributions are monthly or quarterly. 

Pros

  • Diverse investment selection
  • Intuitive platform
  • Variety of distribution schedules

Cons

  • Limited redemption options
  • Open only to accredited investors

Fundrise: Best for Non-Accredited Investors & Beginners

PlatformAvg. annual returns
Fundrise7.31% – 22.99%

Fundrise follows a value investing strategy of acquiring assets for less than their intrinsic value and replacement cost. Through partnerships with local operators and hands-on management, the Fundrise team works to increase the value of assets available on the platform. 

Investment options include equity, debt, commercial, and residential assets. 

Funrise was designed to withstand economic distress, making it ideal for investors that want to diversify to minimize the negative impact of stock market volatility on their portfolio. Extensive underwriting and a conservative approach make Fundrise one of the best platforms for beginning investors. 

Investors may pay a .15% advisory fee as well as a .85% asset management fee. There’s a minimum investment for each account level that ranges from $10 to $100,000.

Average annual returns for Fundrise investors have ranged from 7.31% to 22.99% from 2017 – 2021. Last year was their best year on record returning an average of 22.99% returns to their investors.

As of 2022, Fundrise has more than 210,000 active members and $7 billion in total asset transaction value. They have also returned $160 million to their investors to date. Like Crowdstreet, Fundrise is extremely transparent with their numbers and specifically their return to investors. They even keep a real-time track record to keep tabs on investor earnings.

There are five account levels available on the platform; Starter, Basic, Core, Advanced, and Premium. Each investment tier has a minimum investment amount along with varying investment strategies. 

Pros

  • Accreditation not required
  • Highly-rated mobile app 
  • Share redemption requests available at any time, although redemption is not guaranteed

Cons

  • Investors receive nonqualified dividends (taxed at ordinary income rates)
  • Investments are illiquid

PeerStreet: Best for Investing in Loans

PlatformAvg. annual returns
PeerStreet2% – 9%

PeerStreet provides the largest two-sided marketplace where accredited investors can purchase real estate debt. The platform sources loans from a network of private brokers and lenders. They also aggregate, service, and manage loans for investors. PeerStreet provides investors with the chance to invest in real estate without owning property. 

PeerStreet is the first marketplace that allows non-accredited individuals to invest in real estate debt. When investors put money into PeerStreet and borrowers pay back outstanding loans with interest, dividends go back to the investors. 

Investors interested in PeerStreet can review individual investments to decide whether to become involved. The platform allows investors to automatically diversify their portfolios by choosing investments across various lenders, asset classes, LTV ratios, rates, terms, and geographies.

PeerStreet fees are typically 1%, with a minimum investment amount of $1,000. Investors receive average annual returns of 2% to 9%. Loans have a maximum term of 36 months.

Pros

  • Different product offerings
  • Flexible terms
  • Powerful technology-fueled platform

Cons

  • Accredited investors only
  • Investment types limited to real estate debt
  • May expose investors to higher risks than other real estate crowdfunding types

RealtyMogul: Best for Property Research

PlatformAvg. annual returns
RealtyMogul4.5% – 8%

Investors get institutional-quality deals with the RealtyMogul platform. Both accredited and non-accredited investors can invest in commercial real estate deals. The platform has roughly 219,000 registered members and has financed more than $4 billion in property value. 

Non-accredited investors can choose between two public non-traded REITs and accredited investors can add private placement investments to their portfolio. The platform provides access to individual properties, including office, industrial, retail, medical offices, multifamily, and self-storage. Qualified investors may also have access to 1031 exchanges. Investors can choose from passive income, growth, and diversification objectives when they set up their accounts. 

Fees range from 1% to 1.5%, and the minimum investment is $1,000. Average annual returns historically range from 4.5% to 8%. Investors can get involved with the RealtyMogul platform with a $250 per month auto-investing REIT plan. 

RealtyMogul is well-known for its attention to detail when vetting potential properties. They examine every property in person and evaluate deals using proprietary models and methods. RealtyMogul does not invest in ground-up construction or raw land, which are non-cash-flowing investments. 

Pros

  • Range of investment types
  • Excellent due diligence
  • Start investing with just $250 per month

Cons

  • Fees vary according to investment type
  • Investments are illiquid
  • Long hold periods

Groundfloor: Best for Short Terms

PlatformAvg. annual returns
Groundfloor10% +

Groundfloor facilitates the investment in real estate loans for those looking to fix and flip residential real estate. Groundfloor is available to both accredited and non-accredited investors alike.

You, as the investor, get to shop around for loans to invest in on the platform. Loans are available in different grades returning 5% to 25%. All loans are secured by the underlying real estate.

Average returns to investors since their inception in 2013 has been a little over 10%.

One of the more enticing features of this platform is that the loans generally have terms of just 6 – 12 months, so your funds aren’t locked up for years.

Pros

  • You choose the loans to invest in
  • Excellent due diligence, Groundfloor pre-funds most of the loans
  • Available to everyone

Cons

  • Fixing and flipping homes is a risky investment. This is why the loans have high interest rates with relatively short terms.
  • Only available to invest in residential fixer-uppers.

Roofstock: Best for Rental Property Income

PlatformAvg. annual returns
Roofstock11 – 12%

Roofstock is an Oakland-based Fin-tech startup that was established in 2015. It’s an online marketplace that allows users to buy and sell residential properties that have both tenants and rental income.

On the buying side, you can finance properties or pay in cash and Rookstock will pair you with an experienced property manager that handles the day-to-day operations.

The layout is easy to navigate and you can quickly see key statistics you’d be keen to know as a prospective investor. Things like: gross yield, cap rate, neighborhood rating, etc.

They’ve had over $4 billion in completed transactions since their inception with 734 properties in 27 states currently on their marketplace.

Roofstock One is their newest offering available only to accredited investors. With Roofstock One you can buy shares of rental homes in multiple markets to better diversify your holdings. Minimum investment in Roofstock One is $5,000 and requires you to buy at least 1/10 of a rental property.

Pros

  • No minimum deposits required.
  • Investors can choose to pay cash or finance the properties.
  • Matched with an experienced property manager, so you remain a passive investor.

Cons

  • These are fairly illiquid investments.
  • Requires a large down payment if financing.
  • Roofstock One requires you to be an accredited investor.
  • No mobile app currently.

Real Estate Crowdfunding Platforms Provide Access to a Wide Variety of Investment Types

The Jumpstart Our Business Startups Act of 2013 (JOBS Act) was created to encourage funding of U.S. small businesses. The law eases many securities regulations, allowing companies like real estate crowdfunding platforms to use crowdfunding to issue securities. Before the JOBS Act, real estate investors had just two options; buy publicly-traded real estate investment trusts (REITs) or purchase property and pay to renovate, maintain, and manage it. 

Now, real estate crowdfunding platforms provide an easy and safe way for investors to pool their money to purchase large properties or invest in real estate debt. 

FAQs About Real Estate Crowdfunding

If you still have questions about investing in real estate through online crowdfunding platforms, here are a few more frequently asked questions by consumers like you:

How does it work?

Buying real estate as an investment is typically a sound idea as part of a greater portfolio that consists of stocks, ETFs (exchange traded funds), mutual funds, bonds, and cash. The major barrier to entry, however, has generally been high up front costs associated with the down payment. Along with that hurdle are ongoing monthly loan payments, utilities, maintenance and repair, potentially management fees, etc. Needless to say, it’s typically a costly and time consuming endeavor.

By crowdfunding real estate investments, individual investors can pool their money together using online financial technology companies (aka real estate crowdfunding websites) to fund real estate investments. Most platforms only require a few hundred to several hundred dollars to get started.

This pool of money is then transferred to a holding company – generally a REIT (real estate investment trust) or something similar. These holding companies then own the real estate and operational procedures.

Although there may be hundreds or thousands of investors in the holding company, it is still privately held and pays out dividends to investors on a regular schedule (see individual company’s TOS for details). Public REITs are available as an alternative, where shares can be bought and sold at any time during regular market hours.

Is it safe?

Like all investments, there are elements of risk associated with real estate crowdfunding.

For starters, these are relatively new investment vehicles that haven’t exactly stood the test of time yet. Since most were created after 2013, they haven’t had to weather any major market downturns or recessions up to this point.

Second, the investor (you) will need to have some general understanding of the type of property you’re looking to invest in and will need to conduct your own due diligence. Many of these platforms showcase dozens if not hundreds of properties to buy into. This adds to the risk profile.

Furthermore, when conducting due diligence you may not find every data point you’re looking for or you may not be able to digest everything without thorough experience in the field. Platforms will provide you with an executive summary (sometimes called an OM or offering memorandum) which provides a deeper look into the property, the sponsor and their background, financials, long-term plans and a summary of the investment.

How can an investor get started?

Investors new to the real estate investment scene can start by researching crowdfunding platform options. The best platforms have a track record of solid returns for past investors. They vet new deals thoroughly and have transparent fee structures. 

Before getting involved in real estate crowdfunding, be sure to read the rules about how and when it’s possible to make withdrawals from the account. Understand how redemptions work, as well. 

With real estate crowdfunding, there are no ongoing costs to own real property. It’s easy to track investment performance on the platform, as well. 

A number of the best real estate crowdfunding platforms only work with accredited investors, however. Before new investors can participate, they must submit net worth and income statements to prove they qualify. 

Can you crowdfund in commercial real estate?

Yes, many real estate crowdfunding platforms provide individual investors with the tools and access they need to invest in commercial real estate projects like apartment complexes, self-storage, retail, hotels, and medical complexes. Crowdfunding makes these large investments accessible to qualified individuals. 

Can you make money with real estate crowdfunding?

Yes, depending on the attributes of the individual investment or fund and the platform’s effectiveness, it’s possible to realize positive returns with real estate crowdfunding. Some experts estimate that real estate crowdfunding returns average 11% to 15% per year. 

Even so, real estate crowdfunding is risky. There are no guaranteed returns, and it’s possible to lose an entire investment. Most importantly, with real estate crowdfunding, the investment could be illiquid for years. Investors who discover that they need access to the money they’ve turned over to real estate crowdfunding platforms could face steep fees and wait months to get access to their funds. IT’s crucial to research the platform, fees, redemption rules, and sponsor before committing to a real estate crowdfunding platform investment. 

How does an investor become accredited?

An individual or entity must meet income and net worth guidelines stated in Rule 501 of Regulation D of the Securities Act of 1933. The Securities and Exchange Commission (SEC) defines accredited investors as: 

“A natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year.”

And

“A natural person who has an individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person.”

There isn’t a single entity or agency that reviews an investor’s credentials to determine whether they can participate as an accredited investor. Companies that provide investment opportunities not registered with the SEC must determine a potential investors’ status as an institutional investor by conducting due diligence. Those seeking to participate in real estate crowdfunding investments reserved for accredited investors must provide the company with proof of their financial qualifications.

Are Real Estate Crowdfunding Platforms Worth It?

Maybe. It depends on your investment goals, your risk tolerance, how long you can afford to have your money tied up in an investment vehicle, and your comfort with new technology.

Accredited investors have more options when it comes to real estate crowdfunding investment opportunities. Still, non-accredited investors who would like to use this type of investment as a way to diversify a growing portfolio may find the potential for higher-than-average returns attractive. 

If you want to try real estate crowdfunding and have access to money you can afford to have tied up in an investment for a while, it may be a worthwhile experiment. Be sure to take time to get comfortable with the platform. Understand the terms and fees before signing paperwork or committing funds to the investment. If you are interested in real estate as an investment but aren’t sure about crowdfunding platforms, you may find that publicly-traded REITs are a better fit. 

Filed Under: Real Estate Investing

Motley Fool: Should you Pay for the Premium Service in 2022

Rachel Morey
March 4, 2022

Full disclosure: We may receive financial compensation when you click on links and are approved for products from our advertising partners. Opinions and product recommendations on APYGUY are those of our writers and have not been influenced, reviewed or approved by any advertiser. Learn more about how we make money.

If you struggle to pick individual stocks that outperform the market in the long run perhaps it’s time to outsource this to some experts who have a proven track record to back them up.

The most popular Motley Fool package – Stock Advisors – has seen a return of 491% as of March 2022 based on the average return of all stock recommendations since inception. When compared to the S&P 500’s returns of just 132% within the same time frame, this is quite remarkable.

To take a closer look at Motley Fool’s premium service packages and what to expect, continue reading our review below.

March 2022 Promotion: Join Motley Fool Stock Advisors for just $79.99/year. Normally $199/year.

What is The Motley Fool?

The Motley Fool started offering investment advice in 1993. The company is now one of the world’s largest financial media businesses. Founded by David Gardner and Tom Garder (brothers who still run the company), the site offers free financial news and premium services like subscription-only newsletters with investment advice. 

The Motley Fool employs 47 of the world’s top stock analysts – with 700 employees in total – across 7 offices located across the globe. They research and identify the most significant opportunities for growth in the stock market. 

Motley Fool is one of the top financial companies in the marketplace with over 1 million subscribers, and they back their stock picks with in-depth research. The Starter Stocks Report included with your subscription can help you build a strong portfolio from the ground up if you are new to investing.

The “Best Stocks to Buy” series offers a list of recent Stock Advisor picks that are still viable.

What Information Can I Find on the Motley Fool Website?

There’s a large amount of free educational material available on The Motley Fool website. You’ll find timely articles about investing basics, the stock market, retirement, and personal finance. If you are interested in a certain type of stock or a particular industry, you can dive into those categories to find a wealth of free information on the site, as well. 

The Motley Fool isn’t stingy with their stock advice. Check out last year’s Top 21 Stocks to Buy in 2021 (And the 1 Ultimate Stock) to get a snapshot of how The Motley Fool’s stock picks may look if you decide to subscribe to one of their premium services.

The Motley Fool doesn’t currently have an app. They are in the process of removing their outdated app from the Apple and Android app store. 

Are Motley Fool Stock Picks Any Good? 

Yes. Motley Fool Stock picks include growth stocks that routinely outperform the stock market. 

In November 2018, Motley Fool Stock Advisor recommended that subscribers buy Amazon, Stitch Fix, Apple, Booking Holdings, Arista Networks, and Shopify. These stocks are wildly successful investments. Shopify sold for $134.45 per share in late 2018, and is now selling for $1,247 per share. 

Motley Fool’s stock picks may work for you if:

  • You plan to leave your investments alone for at least five years
  • You have a stable personal financial situation and understand when it makes sense to buy stocks
  • You have a few thousand dollars set aside to invest in the stock market, and can afford to make ongoing investments
  • You understand that an analyst’s risk tolerance may differ from yours and feel comfortable making unilateral decisions about your money that are in your best interests, even if those decisions contradict an “expert”
  • You understand that you could lose money when you invest in the stock market

What Do I Get With their Premium Services?

In a nutshell you can expect the following from any of Motley Fool’s premium services:

  1. 2 stock recommendations each month with in depth analysis.
  2. Historical stock picks with performance data and charts.
  3. Best buys now.
  4. Starter stocks.
  5. Access to live discussions.

Details About Motley Fool’s Premium Subscription Services

You have a wide range of choices with Motley Fool’s premium subscription services. Here, we’ll highlight the subscriptions that offer information about stock picks’ performance since inception.

Stock Advisor

Motley Fool’s Stock Advisor stock picks beat the market average by more than 90%. In the past, they’ve recommended Priceline.com, Costco, Gilead, and Amazon all prior to meteoric rises (among others).

Their services are inexpensive at $199 per year compared to other stock picking subscriptions. Motley Fool frequently runs new subscriber discounts, giving you access to their stock picks for just $99 per year.

March 2022 Promotion: Join Motley Fool Stock Advisors for just $79.99/year.

Philosophy: Buy and hold for at least three to five years.

Membership includes:

  • Two growth stock recommendations monthly
  • Sell notices
  • Best Buys Now; top opportunities among existing Stock Advisor recommendations
  • Regular email updates

2022 Promotion: Join Motley Fool Stock Advisors for just $79.99/year. Normally $199/year.

Rule Breakers

Rule Breakers informed subscribers about growth stocks including Tesla, Mercado Libre, and Under Armour before mainstream investors understood their potential. 

Rule Breakers beat the S&P 500 three to one over the past 15 years by finding and investing in overlooked companies poised for success. 

Philosophy: Purchase at least 25 stocks. Hold them for at least five years.

Membership includes:

  • Two growth stock recommendations monthly from the Motley Fool analyst team
  • Sell notices
  • Best Buys Now; top opportunities among existing Rule Breakers recommendations
  • Regular email updates
  • Access to the Rule Breakers library of expert stock picks

Price for new subscribers: $99 ($1.90 per week) with a 30-day membership refund period, or you can choose one month of Rule Breakers for just $39 (non-refundable). All memberships automatically renew at $299 per year.

New members join Rule Breakers for just $99 per year!

Motley Fool offers a bundle that includes their Stock Advisor and Rule Breakers subscriptions for $498 per year. You’ll get Motley Fool’s 15 “Best Buys Now” stocks via email each month along with access to Motley Fool’s advice about which disruptive stocks have maximum upside potential. 

Supernova

Supernova works best for investors with a portfolio of $90,000 or more. This service offers a look into real-money model portfolios built around investing themes.

Philosophy: Invest in aggressive growth stocks with higher than average volatility and risk 

Performance Since Inception: +327.6%

Membership includes:

  • 3-5 Timely Trade Alerts with explanations from the Supernova Portfolios each month
  • “Exploration Missions” where analysts choose favorite theme-based or Best Buys Now stocks
  • Allocation Calculator to help you calculate funds to match analyst’ model portfolios
  • Regular email updates
  • Supernova discussion boards

Price for new subscribers: Supernova is not currently accepting new subscribers. 

Discovery

Tom Gardner, CEO (and one of Motley Fool’s founders), offers a look into his portfolio of publicly traded stocks along with quarterly buy and sell advice. Discovery: Everlasting Portfolio is designed for investors with at least $100,000 invested in the stock market who want to update their investments just a few times each year. 

In 2012, Tom Gardner sold his publicly traded stocks and pledged to invest his own money into the Everlasting Portfolio. 

As of 2021, The Motley Fool has more than $15 million of its investment capital in the Everlasting Portfolio’s recommended stocks. The fund is up 579%. 

Philosophy:  “Be fearful when others are greedy and greedy when others are fearful.”

Performance Since Inception: +660%

Membership includes:

  • Timely Trade Alerts with explanations
  • Allocation Calculator to help investors match the Everlasting Portfolio positions
  • “Best of the Best” stocks from across Motley Fool’s investing services
  • Investor Action Guide including How to Know When to Sell, Tom’s Principals for Selling, and Tom’s Everlasting Portfolio Guidebook

Price for new subscribers: $2,999 per year, automatically renewable every 365 days; no refunds or credit transfers

Fool ONE

Fool ONE offers complete access to all of Motley Fool’s premium US services as well as international premium services, excluding Mogul. You’ll also get exclusive access to member events and early access to the newest services. 

Philosophy: Buy and hold investing with a three to five year timeline with a high tolerance for risk and a relatively large investing budget

Performance Since Inception: NA

Membership includes:

  • All Motley Fool stock services at a discount
  • All stock investing services launching in the upcoming year
  • Access to stock-ranking database including evern stock that the Motley Fool analyst team recommends and tracks

Price for new subscribers: Motley Fool ONE’s price isn’t published. If you are interested in learning more about the service, please contact the Motley Fool Investor Solutions team via email: InvestorSolutions@fool.com.

Options

With Motley Fool’s Options subscription, you’ll get emails alerting you to timely advice that includes fully-vetted options opportunities from Motley Fool’s analysts. Adding options investments to an established portfolio can significantly increase returns. 

Detailed investment advice helps you decide whether the trade is a good choice for your portfolio. If you choose to proceed, you simply click “Get the Details” in the email for instructions about how to place the trade. 

Since its inception, Motley Fool’s Options recommendations have an 84+% win rate. This service works best for investors with at least $50,000 in their portfolio. 

Philosophy: Master options investing for financial success

Performance Since Inception: NA

Membership includes:

  • At least four recommended options trades each month
  • Access to online educational resources; Options U
  • Access to Options discussion boards
  • Regular email updates

Price for new subscribers: $899 with the option to transfer credit to a different Motley Fool portfolio service within 30-days of purchasing the subscription. Motley Fool Options is non-refundable. Subscription renews automatically every 365 days at $999.

Which Motley Fool Premium Subscription Offers the Best Value?

Motley Fool’s Stock Advisor is one of their most popular subscription services. It has a low introductory price of $99 for new users and an 18-year track record of beating the market. Stock prices can fluctuate wildly, so the Stock Advisor subscription comes with instructions to buy at least 25 stocks and hold on to them for a minimum of five years. 

Stock Advisor picks include stocks from every industry. Motley Fool analysts choose overlooked and undervalued companies ready to soar in value. Subscribers get immediate access to 191 stock recommendations that have a history of 100%+ returns. 

Stock Advisor’s Stock Picks

Two new high-growth stock picks come via email each month from Tom and David Gardner, so there is a constant flow of solid advice about which stocks to buy next. 

The “starter stocks” report offers a list of 10 stocks with a history of providing excellent returns. This report is ideal for new investors who want to diversify their portfolios by investing in time-tested stocks. 

The “Best Stocks to Buy” list offers advice about Stock Advisor’s recent stock picks that are still a good buy. Subscribers can add these stocks to their portfolios right away. 

On average, Stock Advisor recommendations returned more than 566%, compared to 103% from the S&P 500. 

Stock Advisor Research

All of the stocks recommended by the Gardner brothers are researched extensively. Each stock comes with a report explaining the rationale behind the recommendation. You’ll get a taste of how The Motley Fool chooses specific stocks by diving into Stock Advisor research. 

Stock Advisor Education

The Stock Advisor’s education resources offer general investment lessons and information about research methodology for those interested in learning more about choosing winning investments. 

Stock Advisor Community Forum

Stock Advisor members can discuss investing and stock picks in the community forum. This is a great way to connect with like-minded investors, learn more about how others get the most from their Stock Advisor subscription and ask questions. The forum is active, so it’s easy to get timely feedback from other users.

Is Motley Fool Worth it For New Investors?

Maybe. Before you subscribe to Stock Advisor, check out The Motley Fool’s How to Invest Guide. You’ll get a feel for The Motley Fool’s philosophy about investing, including when it’s smart to buy stocks, how to establish an emergency fund to protect your financial stability, and how to allocate assets. 

New investors may want to start by investing in a diversified fund like the Vanguard Total World Stock Index Fund ETF (NYSEMKT:VT), recommended by The Motley Fool’s stock analysts as a set it and forget it fund that works well for investors who need to learn more about the stock market, but don’t want to wait to invest. 

Motley Fool Customer Reviews

Before you spend your money on a stock advising service, it’s wise to read online reviews from verified customers. The Motley Fool marketing team makes excellent use of reviews from customers who are thrilled with the subscription services. It’s crucial to expand your research into areas of the internet beyond The Motley Fool website to get a balanced view of customer sentiment. 

The Motley Fool Suffers on Trustpilot

The Motley Fool has 1,242 reviews on Trustpilot:

  • Excellent: 33%
  • Great: 10%
  • Average: 5%
  • Poor: 5%
  • Bad: 47%

The customers posting negative reviews complain that they experienced losses in the stock market after following Motley Fool’s advice to purchase certain investments. However, Motley Fool repeatedly states that they recommend that investors buy a minimum of 25 individual stocks with plans to hold those investments for at least five years to “counteract the whims of the market.” Investors who get nervous when stock prices dip and sell at a loss are understandably upset. 

Many of the negative reviews point to information found in Motley Fool’s free content, generated by in-house analysts and contracted experts. Motley Fool encourages investors to conduct their research before deciding whether an analyst’s advice works for their situation. 

The Motley Fool customer service team responds to each negative review to solve any ongoing problems. 

Motley Fool Stock Advisor Customers Sound Off on Reddit

Reddit users have a lot to say when asked,”Is Motley Fool worth it?” Many users posted responses to a question posed by a curious Motley Fool user who was on the fence about whether to pay for a premium subscription. 

Investors who purchased shares of FICO, Shopify, Wix, and Amazon before they were well-known successful companies offer glowing reviews of the paid-for subscription services. New subscribers point out that even if they make just a few hundred dollars following Motley Fool’s advice, it will be worth the Stock Advisor service subscription price. “…at least the Gardner brothers know what they are doing (they outperform the market consistently)” -lame_corprus

Other Reddit commenters point out that unless you have a hefty sum of money to invest, you may not fare well with Motley Fool’s stock picks. “The problem was, that some of the lesser expensive ones, tanked, and the more expensive stocks, were the ones that doubled, or tripled in value. So, if you didn’t buy the “whole set” and trade exactly what and when suggested . . . you were likely to lose out.” -PhesteringSoars

The Motley Fool Responds to All Customer Complaints on the BBB Website

The Motley Fool Inc. has 160 published customer reviews on the Better Business Bureau (BBB) website. The company has an average rating of 4.03 stars out of five. The BBB closed 123 customer complaints in the past three years and 66 in the past 12 months. Customers complain about various hardships, including a lack of response from Motley Fool’s customer service department. 

Many of the customer complaints on the BBB website have to do with trouble logging in, not receiving a free report via email as promised, or automatic renewals. Customers complain that Motley Fool emails them with special offers too much and that they can’t get a full refund after they’ve signed up for Motley Fool’s non-refundable offers. 

The Motley Fool customer service representatives offer this explanation for their lack of accessibility: “We have been experiencing unusually high call and email volume; we sincerely apologize for any inconvenience this may have caused. Our team is working diligently to respond to each email.”

Motley Fool representatives respond to each complaint filed with the BBB with a detailed explanation of precisely what happened along with an immediate resolution.

Motley Fool Review: A Warning About Stock Advice Subscriptions

Motley Fool’s menu of stock picking services operates on the buy-and-hold philosophy of stock market investing. If you want help becoming a successful day trader, move on. 

Motley Fool’s menu of stock advisor services renews automatically. Make sure you are comfortable with Motley Fool automatically charging your credit card for the total amount of the yearly subscription service every 365 days. 

Many of the subscription services work best if you can afford to invest at least $25,000 in the stock market. Suppose you have a small budget for investing and can’t afford to put money into the stock market each month. In that case, you may be better off reading the free information offered by Motley Fool writers on their website and using that knowledge to make investing choices. 

The Motley Fool is prohibited from offering personalized investment advice, so they provide equal access to information for anyone who subscribes to one of their services. Their strategies appeal to different investment styles and interests, but they don’t offer a one-size-fits-all solution. 

Is Motley Fool Worth it? 

If you decide to try a Motley Fool subscription to level up your investing game, don’t get so excited that you skim over the Important Notes right above the green “Submit My Order” button. Make sure you understand the price of your subscription as well as how and when it renews. The rate you pay for year one could be significantly lower than the amount you pay in subsequent years. 

You must be willing to open a brokerage account (if you don’t already have one), purchase the stocks recommended by Motley Fool’s analysts, and leave those investments alone for at least five years. Before you decide to invest in a Motley Fool premium subscription, consider your budget, investing style, tolerance for risk, and willingness to follow the advice. The service should meet your needs without pushing you to make investments that are too far out of your comfort zone. 

If you plan to purchase stocks regularly, want to learn more about how to make the right investments to help you reach your financial goals, and don’t have the time or knowledge to do your research, it’s wise to look into a stock advisor subscription. Motley Fool stock advice subscriptions consistently outpace the stock market as a whole. If you pay for a subscription, you will receive the information you need to invest in stocks with a high probability of providing a great return.

2022 Promotion: Join Motley Fool Stock Advisors for just $79.99/year. Normally $199/year.

Filed Under: Investing Tagged With: The Motley Fool

Seeking Alpha 2022 Review – Is the premium service worth it?

Rachel Morey
February 21, 2022

image credit: seekingalpha.com
Full disclosure: We may receive financial compensation when you click on links and are approved for products from our advertising partners. Opinions and product recommendations on APYGUY are those of our writers and have not been influenced, reviewed or approved by any advertiser. Learn more about how we make money.

If your investment portfolio includes individual stocks, you need the best research to invest successfully. You can assemble your research using analyst reports and information from news outlets, but the DIY approach to stock research can be time-consuming and tedious. 

Fortunately, you have many choices when it comes to investment research platforms. 

Seeking Alpha has a long history of providing investment advice. Free content on the Seeking Alpha site offers access to the largest investing community in the world. Fueled by crowdsourcing, the platform has millions of experienced investors who connect to share investing ideas, discuss breaking news, and help each other make solid investment decisions. 

Here, we’ll evaluate Seeking Alpha’s Premium tier of services. The service targets intermediate and advanced traders. It requires a small financial investment compared to some high-profile competitors and has a long track record of success. 

What is Seeking Alpha?

More than 7,000 contributors publish over 10,000 articles about funds, asset classes, and specific stocks on the Seeking Alpha platform. You can receive investing newsletters about topics like market sectors, individual tickers, and market headlines. Users can also monitor portfolio performance, read market news, and see earnings call transcripts. 

Seeking Alpha’s stated mission is “Power to Investors.” 

SA’s in-house team of editors vets all research. They seek to empower investors to make intelligent investing decisions using Seeking Alpha’s stock research tools. Diverse opinions on individual stocks allow readers to make informed decisions about whether to invest in a stock, when to sell, and how a stock’s future earnings may contribute to a portfolio’s overall growth. 

The data available on the Seeking Alpha platform connects any investor to professional-caliber tools. Quant ratings and factor grades summarize an individual stock’s characteristics, while author ratings offer snapshots of various contributor’s opinions. 

Seeking Alpha Membership Tiers

The monthly prices highlighted above are available for those who pay annually.

With Seeking Alpha, there are three membership tiers. 

  • Basic: Free.
  • Premium: $29.99/month (14-day trial available). $19.99/mo if billed annually.
  • Pro: $299.99/month. $199.99/mo if billed annually.

New investors and those with intermediate experience find everything they need to level up their investing game with the free and premium tiers. Seeking Alpha Pro is best for professional investors and those managing significant portfolios. It provides high-level investing ideas and research from all sectors and industries. 

Who is Behind Seeking Alpha?

David Jackson, a Wall Street analyst, founded Seeking Alpha in 2004. Frustrated by the lack of coverage of small-cap companies by Wall Street, Jackson invented the crowdsourced stock research platform as an alternative to relying solely on analysts from Wall Street for information. 

He wanted to highlight companies that were too small to get the attention of high-profile analysts. The site now has more than 10 million visitors monthly (200,000 of which are paying for a premium subscription) and enjoys partnerships with CNBC, Marketwatch, Yahoo! Finance, and MSNBC. 

What Information Can I Get With A Seeking Alpha Premium Subscription?

Upgrading to Seeking Alpha Premium means you’ll have instant access to thousands of articles to help you decide where to put your investment dollars. Most investing idea articles remain accessible on the site for ten days from publication. After that, they go behind the Premium tier paywall.

Premium members can access Seeking Alpha’s easily searchable database of articles no matter when they were published. Many users subscribe to Seeking Alpha Premium and Motley Fool Stock Advisor to find specific investor articles about the regular monthly stock picks from the Motley Fool Stock Advisor. 

Here’s the breakdown of everything you get with Seeking Alpha Premium:

  • Market Intelligence: Small-cap stock information and analysis not available on other investment sites. 
  • Superior Analysis: Published ideas, research, and analysis plus insights from peer networking outpace in-house investing results. 
  • Actionable Ideas: Daily actionable ideas from SA’s in-house experts. 
  • Advanced Filters: Easily and quickly construct new investment ideas using SA’s market cap, country, long/short, and investment style filters. 
  • Professional Community: SA is a crowdsourced investment platform encouraging members to exchange ideas, offer feedback on expert analysis, and provide direction to new investors. 

Seeking Alpha authors attach a rating to an ETF or stock:

  • Very Bullish
  • Bullish
  • Neutral
  • Bearish
  • Very Bearish

Ratings are visible to Seeking Alpha’s Premium tier and Pro tier subscribers only. 

The “Bulls and Bears say” section provides a snapshot of why a stock may be worth buying, why you may want to avoid it, or why it may be time to sell your shares. 

The sidebar on each stock rating offers even more valuable information while helping to reduce the time you spend evaluating a stock:

  • Stock price chart
  • Stock rating from the article’s author
  • Seeking Alpha scoring models ratings using proprietary models

Earnings and conference call transcripts: Listen to recorded earnings and conference calls; print and download transcripts and presentation slides. Basic members have read-only access to transcripts. Here are a few other tools reserved for Seeking Alpha Premium tier members:

Ten years’ worth of financial statements for individual stocks: Basic members can access five years’ worth. 

Earnings forecasts: Extra factors such as earnings estimates and surprises. Basic members can see only stock ticker’s dividend payment schedules and earnings reports. 

Notable calls from Wall Street and fund managers: Understand how top investors manage their cash. 

Portfolio monitoring: Get timely news on your investments. Monitor performance and receive alerts.

Sync brokerage accounts: Link US brokerage accounts to the Seeking Alpha platform to monitor multiple accounts in one place. Basic members can track their portfolios by manually entering each stock. 

Personalized alerts: Get breaking news for all of your portfolio holdings. Read the alert from your email inbox. Basic members must visit SA to read alerts. 

News dashboard: Read market headlines and news with enhanced capabilities for a deep dive into the research. SA’s news dashboard is an excellent alternative to Barron’s or The Wall Street Journal. 

Earnings Calendar: View a list of upcoming reports and calls from your stock portfolio. Access EPS revision scores and the latest company reports as the market adjusts.

Seeking Alpha Returns

Stocks rated as a “Strong Buy” by Seeking Alpha have done historically well when benchmarked against the S&P 500.

Since inception Seeking Alpha’s “Strong Buy” stock picks have produced average annualized returns of 29% to investors.

Here’s a breakdown of their “Strong Buy” rating track record:

image credit: subscriptions.seekingalpha.com

Seeking Alpha VS Motley Fool

The Motley Fool is an investment advisory newsletter service and one of the most popular in the industry. Their history stretches 20 years and in that time they have picked some of the most successful stocks.

Here’s a look at their popular subscription offers and the annual returns those picks have provided investors since inception to give you an idea:

Motley Fool ServiceInceptionReturnsS&P500
Stock Advisor1993+508%~134%
Rule Breakers2004+270%~115%
If you’re interested in The Motley Fool, you can now get Stock Advisor for Just $99/year!

Seeking Alpha Media

Seeking Alpha’s Premium tier includes access to several contributors offering subscriptions to their investing newsletters. These newsletters provide model portfolios and in-depth analysis not available in the Investing Ideas articles. 

Seeking Alpha also offers eight investing podcasts covering daily market activities, investing in ETFs, and trading stocks. 

Choose from 15 free newsletters such as focused sectors and the morning market headlines. 

The Stock Ideas feed organizes articles according to their theme. You’ll find the most-read articles on the seeking Alpha homepage. 

The Investing Strategy collection of articles helps investors shape their portfolio investment strategy to feed long0term financial goals. While much of the content is for financial investors, individual investors may also find the information useful. 

Seeking Alpha FAQs

What is a Seeking Alpha author rating?

Contributors who submit investing ideas have a long-term track record attached to their profiles to help you decide if their long-term predictions pan out. 

Subscribers can see an author’s rating history and their favorite stocks. Some Seeking Alpha contributors also work for high-profile investment firms, so their investing advice offers valuable insight into their overall investment strategy. 

How Can Investors Use Seeking Alpha’s Stock Screener?

image credit: seekingalpha.com

The Stock Screener, reserved for Premium tier subscribers, allows users to customize filters, including market caps, author ratings, and momentum or growth ratings. Premade screeners help find top-rated ETFs and stocks quickly. 

Here are some examples of screeners already set up within Seeking Alpha’s Premium tier:

  • Dividend stocks: above bullish rating yielding a minimum of 2%
  • Growth stocks: minimum $1 billion market cap
  • Value stocks: minimum $1 billion market cap
  • Best stocks by market sector: consumer staples, technology, etc. 

Does Seeking Alpha Premium Provide Quant Ratings?

Yes. The proprietary quant rating system on the Seeking Alpha platform helps everyday investors understand the more complex aspects of investing. Investors can use SA’s quant ratings to analyze large volumes of data in a short amount of time. Quantitative analysis helps professional investors manage their portfolios and research stocks. 

Seeking Alpha’s quant score uses these factors:

  • Stock price momentum
  • EPS revisions
  • Growth
  • Value
  • Profitability

Backtesting helps calculate final quant ratings.

What is the Seeking Alpha Factor Scorecard? 

The factor scorecard assigns a letter grade from A+ to F for each of the following factors:

  • Growth
  • Profitability
  • EPS revisions
  • Momentum

Real Estate Investment Trusts (REITs) also receive these ratings: 

  • Funds from Operations (FFO) 
  • Adjusted Funds from Operation (AFFO)

Factor scorecards help investors evaluate stocks by offering detailed information about the stock’s performance. If you click on any of the stock’s ratings, you’ll get details about why the stock received that particular rating along with the underlying data. 

For even more specific information, use the Dividend Stock Scorecard to help you avoid investments with unsustainable yields. 

Seeking Alpha Pros and Cons

Pros:

  • Find market analysis, predictions, and news on one platform
  • Unlimited access to investing articles and ideas
  • Track entire investment portfolio in one place
  • Reviews include most ETFs and stocks
  • Contributors are expert analysts and traders
  • Provides exposure to new investment strategies

Cons:

  • Casual investors may find the volume of information overwhelming
  • It can be challenging to keep up with the in-depth analysis of multiple stocks
  • The monthly cost may be too high for everyday investors

Seeking Alpha Premium Subscription Costs

The Seeking Alpha Premium subscription comes with a free 14-day trial, which investors can use to evaluate every aspect of the service. After the trial, the service costs $29.99 per month plus applicable taxes. If you decide to purchase a yearly subscription for $239, the cost breaks down to $19.99 per month.

If you think that price tag is a little steep, then keep your eye out for specials and discounts. Seeking Alpha regularly runs these promotions usually on Holidays or other noteworthy days. Here’s an example of a 50% off deal from President’s Day, February 21, 2022.

Contact customer service or log into your account settings if you want to cancel during your free trial.

Seeking Alpha sends a reminder email two days before the end of every free trial to remind new users that their cancellation window is closing.

Is Seeking Alpha Premium Any Good?

Yes. The Seeking Alpha Quant System regularly beats the market. They’ve outperformed the market four-to-one every year since 2010. 

Past performance is not a guarantee of future results. 

Here are three stocks that the Quant System identified as Very Bullish, along with their performance as of March 2021:

  • Tupperware: Up 571%
  • Cassava: Up 1,085%
  • Novavax: Up 1,188%

Seeking Alpha Reviews From Verified Users

According to Sitejabber, Seeking Alpha has a consumer rating of 3.5 stars from 190 reviews indicating that most customers are generally satisfied with their purchases. Seeking Alpha ranks 39th among Stock Trading sites.

Positive reviews (last 12 months): 73.9%

Jacquelyn D.

Is Seeking Alpha worth it?

July 9th, 2021: Verified purchase 

“I have used both the free and the fee services of SA. I believe it is very much worth the $’s and the time spent in reading the articles. Not all of them will apply to your investment plan. But even the ones that don’t give you a perspective on other investment opportunities. As an investor whose goal is dividend yield and growth, I have the opportunity to read those authors’ that will provide me with good information. Readers’ comments are also useful for new ideas and as a check on an author’s support of an investment.”

David R.

Seeking Alpha a sweeping breadth of information

July 2nd, 2021: Verified purchase 

“I have been following many of the writers on Seeking Alpha for many years. I recently became a premium member and use the information everyday. It gives me perspective on stocks from several authors with different opinions, which I find very useful when I am evaluating purchasing a new position. I use this in combination with other services including Stansberry, Oxford Club, Sure Dividend and Kiplinger.”

Is Seeking Alpha Worth It?

Seeking Alpha Premium is suitable for swing traders and intraday investors who want independent perspectives on companies. To get the most out of Seeking Alpha Premium, you’ll need a solid understanding of stock analysis. 

Subscribers who find the most value in Seeking Alpha Premium have the following attributes in common:

  • Serious investor with at least five individual stocks
  • Enjoy researching ETFs and stocks
  • Require access to Seeking Alpha’s content that’s older than ten days

Seeking Alpha is a powerful research tool offering the buy and sell reasons for individual stocks. Investors must decide which stocks to buy and when, however. 

Active investors who require in-depth research to make money by investing in the stock market may find Seeking Alpha Premium a smart use of their money.

Filed Under: Investing Tagged With: Seeking Alpha

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