Motley Fool Augmented Reality Review

Motley Fool Augmented Reality Review
  • Portfolio Performance

  • Research

  • Value

Summary

Motley Fool Augmented Reality is a stock-picking service that attempts to uncover innovative tech companies that are set up for massive growth. The service features a portfolio of 28 hand-selected stocks that are set to disrupt the tech industry. Is the service worth paying for? Read our review to find out.

About The Motley Fool

The Motley Fool is a financial advice and news company based out of Alexandria, Virginia. The company was founded in 1993 by Tom and David Gardner. The Gardner Brothers created The Motley Fool to share their investment ideas and strategies online. What started as a basic AOL website eventually evolved into a standalone website and continued to grow into the financial media powerhouse we know today.

The Motley Fool

The Motley Fool

Motley Fool now runs multiple premium investment services, most of which specialize in stock-picking.

We’ve written about the Motley Fool’s history in our Stock Advisor review, so check that out if you want to learn more about the company. We have also reviewed other popular services from the company, such as Motley Fool Everlasting Portfolio, Motley Fool Rule Breakers, Motley Fool Options, and Rule Your Retirement.

Today, we’re going to take a look at one of the company’s newer services, Augmented Reality. Augmented Reality adds a unique twist to the company’s stock-picking business model. Is this service worth signing up for? Keep reading our Motley Fool Augmented Reality review to find out.

About The Motley Fool Augmented Reality

Motley Fool is known for providing well-research stock picks with a history of beating the stock market. The company’s flagship service, Stock Advisor, offers two new stock picks to members every single month. The Stock Advisor service has been around for over 15 years and is still thriving. The company has since launched a handful of new services with unique value propositions. Most of these services specialize in specific types of stock picks.

The subject of today’s review is the Motley Fool’s Augmented Reality service (also referred to as “Augmented Reality and Beyond”).

Motley Fool Augmented Reality and Beyond

Motley Fool Augmented Reality and Beyond

Augmented Reality (AR) is a stock-picking service that is focused on the next generation of technology. If you’ve been following the market for the past couple of decades, you know that technology has been the hottest sector. Many tech companies have returned upwards of 1,000% in the past decade (some higher than 10,000%).

By now, we are all familiar with many of the leading tech companies. We all know about Amazon, Netflix, and Apple. While these companies still have bright futures, it’s likely that their explosive growth is behind them (i.e. 10,000%+ returns).

At one point, these companies were hidden gems offering investors the investment opportunity of a lifetime. Imagine discovering these companies a decade ago. If you invested $1,000 in Apple or Amazon in 2010, your investment would be worth over $20,000 today. If you invested $1,000 in Netflix, it would be worth over $60,000!

These investments seem obvious now but, at the time, these companies were just a few tech stocks in a sea of thousands. Motley Fool’s Augmented Reality service seeks to uncover the hidden gems that will profit from the next era of technology. Motley Fool believes that augmented reality (sometimes referred to as “virtual reality”) is one of the main sectors set to benefit.

Right now, there are dozens of companies that are likely to experience massive growth in the coming years. Motley Fool’s research is geared towards uncovering the next Apple’s, Amazon’s, and Netflix’s.

Motley Fool Augmented Reality

Motley Fool Augmented Reality

What Do Augmented Reality Members Get?

Augmented Reality is a purposefully simple service with three key offerings:

  1. Access to Motley Fool’s Augmented Reality Research
  2. Access to the Augmented Reality Portfolio
  3. Buy/Sell Alerts for Stocks

Let’s take a look at each of these core offerings.

Augmented Reality Research

Motley Fool is in the business of stock market research. The company’s advisors do in-depth research on a range of stocks before narrowing their recommendations. Once a stock is chosen as a winner, the company compiles a research report for subscribers.

The research is delivered in a simple and easy-to-read research report that covers all of the information you need to know about a company. This is one of the areas where the Fool really shines. If you’ve ever combed through financial reports/filings or read through an analyst report, you’ve probably noticed how overwhelming they can be. They are loaded with technical writing, jargon, and complex charts.

A research report is only valuable if a) you actually read it, and b) you understand what you are reading. Motley Fool’s research reports check both those boxes. They are easy-to-read and easy to comprehend.

A Motley Fool Augmented Reality research report is generally 1000-1500 words and includes the following sections:

  • Why the Company Will be a Leader in Augmented Reality
  • Why the Company is a Good Investment
  • Potential Risks
  • The Bottom Line

These research reports are particularly interesting to read since they focus on companies that are shaping the future of technology.

Augmented Reality Portfolio

Augmented Reality subscribers have access to the full Augmented Reality portfolio of stocks. This is basically a list of all of the current investment recommendations.

Augmented Reality Portfolio

Augmented Reality Portfolio

Investment recommendations fall under three main categories:

  1. Leading the Way – These are established companies that you are likely to recognize. They already have a strong footing in the technology industry and, while they may not be set up for parabolic growth, they are a bit safer since the companies are already thriving. This group of stocks is intended to add a bit of stability to your portfolio.
  2. Shaping the World – These are the companies that are currently shaping the world of augmented reality. These are big companies making big moves in the AR space. They are slightly riskier than the companies “leading the way” but they may also yield higher returns in the long run.
  3. Highfliers of the Future – These are the companies with the most potential. They are newer companies that are disrupting their respective industries. Since the companies are newer, they are riskier, but they may also provide the best long-term returns.

If you are signing up for the Augmented Reality service, the portfolio is the most valuable resource. The portfolio is likely the reason you are paying for the service. Research reports are great, but most investors just want to know which stocks they should buy, and that’s exactly what you get. When you sign up, you get instant access to 28 hand-picked AR stocks that are set up for massive growth.

We will analyze the returns of this portfolio later in the review, but for now, we will cover the last offering.

Buy/Sell Alerts

The Augmented Reality portfolio is everchanging and The Motley Fool will issue buy alerts and sell alerts whenever they adjust their recommendations. For example, if the company’s analysts discover a great new company, they will issue a new buy alert. If a company is underperforming, they will issue a sell alert.

This service is designed for long-term traders so the alerts aren’t very frequent. There’s generally no more than one alert each month.

Motley Fool Augmented Reality Performance

Now, it’s time to answer the most important question in our Augmented Reality review – how does the portfolio perform?

If you are paying for this service, you are paying for stock picks and you want to make sure those stock picks deliver. While we can’t reveal any of the actual stock picks, we can reveal some interesting statistics about the portfolio.

We will start with the most relevant. The portfolio was launched in June of 2019 and has since returned 69.3%. During that same period, the S&P 500 returned 18.4%, meaning the AR portfolio beat the market by over 50%

Motley Fool vs. S&P 500

Motley Fool vs. S&P 500
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Here are some interesting statistics on the 28 stocks in the portfolio (based on October 2020 data).

Stock Types

  • The average market cap is $268 Billion ($49 Billion Median)
  • The average stock price (at the time of the recommendation) is $180 ($134.26 Median)
  • The lowest priced stock is ~$30
  • The most expensive stock is ~$1,000

Returns

  • The return of the entire portfolio is 69.3%
  • 23 stocks have positive returns
  • 5 stocks have negative returns
  • The average gain is 87.17%
  • The average loss is -12.82%
  • The biggest gainer is up 406%
  • The biggest decline is down 34%

Overall, Augmented Reality offers a well-balanced portfolio that combines both established companies and growth companies. While the service has only been around for just over a year, the returns are impressive so far.

Augmented Reality Portfolio Performance

Augmented Reality Portfolio Performance

Motley Fool Augmented Reality Pricing

Augmented Reality is available as an annual subscription for $1,399 per year. When you sign up, you get instant access to all of the resources mentioned above. While the subscription recurs annually, you get a lot of value upfront and you may find that you only need access for one year.

Is Motley Fool Augmented Reality Worth the Money?

Now that you know about Motley Fool’s AR service and the portfolio performance, it’s time to answer the question you likely came to this review to find an answer to. Is the subscription worth paying for?

Let me start by saying that Augmented Reality is a great service and the portfolio has yielded impressive returns so far. That said, you don’t just need a great stock picking service, you need a service that is great for you. Every investor has different needs and circumstances so it’s important to make sure you choose the service that best suits your needs.

If you are considering signing up for Motley Fool’s Augmented Reality program, answer the following two questions.

Does the Service Line Up With Your Investment Strategy?

Augmented Reality is a specialized service that is suitable for a select group of investors. If you can check the following boxes, the service is a good fit for you.

  • Plan to hold your positions for at least 3 to 5 years – These are long-term stock picks that are likely to experience short-term price swings. Focus on the bigger picture. These picks are designed for investors with long-term time horizons.
  • Plan to diversify with at least 12-15 stocks – The power of this service comes from the portfolio aspect. Don’t go looking for one hot stock. When looking for the next big companies of the future, you can’t expect to put all of your eggs in one basket and get it right. Plan to diversify by adding at least 12-15 of the 28 recommended stocks.
  • Expect some volatility – The stock market can be volatile. Tech has been particularly volatile due to the sector’s explosive growth. If you are looking for stocks that return upwards of 100%, you can’t let 10-20% swings shake you out of a position. Risk-conscious investors may want to be proactive with risk management (i.e. cutting losses) but you should understand the volatility you may experience before you invest your money.

If you have a long-term time horizon, are ready to build a diverse portfolio, and can stomach market volatility, the Augmented Reality stock picks will be in line with your investing strategy.

How Much Capital Are You Investing With?

In many areas, value is subjective. In the world of investing, it’s actually relatively easy to gauge the value of an investment advisory service. You’re simply attempting to answer the question, “will this service make me more money than they charge me?”

Fortunately, we have the data to perform that analysis.

We can analyze Motley Fool’s performance relative to the subscription cost. The subscription costs $1,399/year, and the portfolio has returned ~70% over the past year. The S&P 500 has returned ~20%, meaning the AR portfolio yielded 50% higher returns.

So, how much are 50% higher returns worth to you? You can run the numbers based on how much money you plan to invest. The following example is intended as an educational experiment and should not be misconstrued as financial advice. You should always talk to a certified financial professional or do your own assessment before purchasing a service. 

  • If you invest $1,000, the increased returns are worth $500
  • If you invest $10,000, the increased returns are worth $5,000
  • If you invest $100,000, the increased returns are worth $50,000

Of course, this example is oversimplified to help illustrate the point. Past performance is not indicative of future returns and the AR Portfolio’s performance will vary by year (some years higher, some years lower).

The example above is intended to get you thinking about the value of the service relative to your portfolio size. We can apply the same assessment to consider how much the portfolio needs to return for you to break even on the subscription fee.

  • If you invest $1,000, the portfolio needs to beat the market by 140%
  • If you invest $10,000, the portfolio needs to beat the market by 14%
  • If you invest $100,000, the portfolio needs to beat the market by 1.4%

If you are only investing a few grand, it may be difficult to recoup your subscription fee. You would be better suited for a service like Motley Fool’s Stock Advisor which is available for only $99/year.

If you have upwards of $10,000, the service starts to become more valuable. While the Augmented Portfolio service is only one-year-old, the Fool has a 15+ year track record of beating the market with their other services.

Motley Fool Augmented Reality Review: Final Verdict

Motley Fool Augmented Reality is a unique service that is focused on uncovering the winners of the next era of technology. The service is easy-to-use and the research is easy to comprehend. While the service has only been around for one year, it is off to a strong start. The portfolio has returned ~70% since it was launched in June of 2019.

Technology is likely to continue to be a leading sector for years to come. If you are looking for stock picks that are focused on innovative tech companies, Augmented Reality is a great choice.