There’s a well known saying – “different strokes for different folks.” It’s a bit of an old fashioned way of saying that not everybody needs or likes the same thing, and there is nothing wrong with that. One direct comparison that can highlight how two effective products serve different audiences just as well is when the services offered by the Motley Fool vs Seeking Alpha are analyzed. The subject has been discussed before, and there a few specific things worth highlighting for anyone who is on the fence about which of these products is best for their investment needs. After all, there are few decisions more important than where to go for investment advice and its well worth the upfront effort of reviewing all your options.
Looking at the Basics
By better understanding the differences between the two services, investors will have an easier time deciding which is right for them. The Motley Fool is a straightforward offering and has been providing information to investors since its founding in 1993. It has been analyzed elsewhere and that may be a good starting point.
It churns out 12 stock picks per year, delivered right to subscribers directly. Speaking generally the stocks recommended are better known and stable companies, but they do have a higher growth (and higher risk) stock picking service too. The information provided is direct, digestible and does not require extensive additional research – although investors would always be wise to do their own due diligence before buying individual stocks.
The ”Fool” part of their name comes through a little bit in their writing style, which uses some tongue in cheek humor to make a complex subject more accessible to their audience. But don’t be mistaken (or fooled, for that matter) – their advice is completely serious and has the track record to back it up.
Seeking Alpha is firmly on the bandwagon of what is known as “crowd sourcing” – aggregating a wide range of reader contributions to create a larger body of information. That said, the site has been around since 2004 so it is not a fad or trend. It claims to have more than 10,000 articles contributed each month by thousands of users, and it offers an editorial review process as well as requirements of disclosure of any potential conflicts by authors recommending stocks.
The Drawbacks
The biggest knock on the Motley Fool is manageable for most people – it sends out a lot of communication, including “Alerts” and click-bait-like emails previewing its latest hot pick. It’s not the end of the world but could easily get on the nerves of someone who likes a tidy email inbox. Seeking Alpha’s biggest drawback is that crowd-sourced information is by nature hard to do good quality control on – despite their review process, readers should understandably be skeptical of basing investment decisions on the opinions of such a wide range of people.
One way they help counter this is through their Quant service, available at a higher subscription level. Quant provides objective, numbers based rankings of stocks to help filter out subjective opinions. Their Premium service level also offers author rankings, which help readers determine which views to take the most seriously (or not).
The Dollars and Cents
Price is another important factor to consider when looking at the Motley Fool vs Seeking Alpha. The Motley Fool’s Stock Advisor service costs $199/year, or $99/year for first time users, but a special introductory first year rate of $79 is available. Seeking Alpha has a Premium service available for $19.99/month if an entire year is purchase, or $29.99/month to go month by month. A more expensive Pro service is available for $199.99 per month with a year’s purchase, or $299.99 for month-to-month service. Some introductory deals for those looking to try out Seeking Alpha are available here.
Motley Fool vs Seeking Alpha: The Final Call
Both services are good for investors – but the question of which is best for a given individual investor is largely a personal preference. The Motley Fool is a great option for those looking for direct, reliable information about which stocks would be smart to buy. That said, picking individual stocks is risky and there is a chance of outsized gains (or losses) if you only pick some of their recommended 12. Over the years, buying all 12 has proven to be effective but not every investor has enough cash for that kind of a diversification strategy.
Seeking Alpha is a powerful and robust tool for investors who have the time and foundation of knowledge to use it correctly. It will not hand feed you great stock picks with no further research required, but the information necessary to unlock many great picks can be found on the site for those with the ability to look for it.
