Everyone invests to make money. (Well, at least we hope they do.) So the key thing when buying an investing newsletter should be its ability to make money.
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Yet it's a little more complicated than that. Because people invest with slightly different goals. Some are looking to maximize total returns, while others seek to consistently make money each year, with minimum volatility. Fortunately, The Motley Fool has a product designed with each group in mind: Motley Fool Million Dollar Portfolio (or MDP for short) and Motley Fool Pro.
The key differences between MDP and Pro
Advisor Matthew Argersinger and the MDP team aim to beat the market, while Pro advisor Jeff Fischer and his team seek to deliver 7% returns each year after inflation has been factored in. They call this their "North Star", and it encourages the Pro team to seek low-volatility ways to make money.
This brings us to a second important difference between Pro and MDP: Pro uses options and ETFs to complement its stock holdings, while MDP doesn't. That's because options, properly used, can provide a powerful hedge against volatility. That makes them attractive for the Pro team as they aim for their North Star. (And Jeff Fischer, who also runs The Motley Fool's options service, is an expert at using options for income and hedging.)
MDP, meanwhile, focuses strictly on stocks – because investing in great businesses with a long-term mindset can make for incredibly powerful compounding returns.
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Where MDP and Pro are similar
That long-term mindset is at the core of both MDP and Pro's philosophies. Even though they approach the actual act of investing (and the volatility associated with it) differently, at their core, both aim to make their subscribers a lot of money by owning great businesses run by great management teams.
And when it comes down to it, MDP and Pro are more alike than not. In addition to their mindset, they offer similar benefits:
- Regular investing recommendations. The MDP team builds a watchlist of the very best stocks from The Motley Fool's stock idea newsletters – Stock Advisor, Rule Breakers, Inside Value, Income Investor, and Hidden Gems – every month. The team then debates the stocks and which ones deserve a place in MDP. Jeff Fischer and the Pro team don't follow precisely the same process – after all, they might have options with expirations happening throughout any given month – but they also regularly make stock, ETF, and options recommendations.
- Real cash behind every pick. MDP and Pro are both real-money portfolios where The Motley Fool puts actual cash behind the portfolio allocations they recommend. In effect, we're saying that we're so confident in these teams' ability to pick great investments that we're willing to put our money where our mouth is. Real-money portfolios have another benefit: They encourage the team to think carefully about opportunity cost, as a dollar invested in one area can't be invested elsewhere. That mirrors the tough choices everyday investors have to make, so it aligns each team even better with their subscribers.
- Detailed research and ongoing coverage. Every stock (or other investment) recommended in either MDP or Pro is accompanied with a research write-up that thoroughly documents the opportunities and risks specific to that company. (And Pro's more advanced trades come with step-by-step instructions so anyone can follow along.) Additionally, both teams provide regular coverage as the companies they've invested in report material news (think quarterly earnings or other news with the potential to move the stock in a big way) and communicate any updates in their thinking as well.
- Happy, engaged investing community. Both newsletters also operate message boards, where a knowledgeable and engaged community of members talk through recommendations and trades. If you're a new investor, it's a great place to find mentors – if you're more experienced, the boards are an opportunity to further deepen your knowledge and engage with the MDP or Pro But don't just take our word for it: Learn more from happy members of MDP and Pro yourself!
One other shared similarity:
Both MDP and Pro are on sale right now
We're offering both newsletters at a discount right now to readers of Fool.com. If you're interested in learning more about them, now's a great time to dive in and see if either might be right for you. So take a few minutes and learn more about Pro or consider whether an MDP membership makes sense for you.
The Motley Fool has a disclosure policy.