Flawed Analysis at Motley Fool
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Will,
Point taken!
As for Cramer, I too wouldn't act on anything he says. Which isn't to say that he doesn't know what he's doing, but rather I find his show better suited to distracting me while I'm on the treadmill at the gym.
ETF guy,
What Greg was trying to say that Motley Fool supports their opinions with actual data, from financial statements, it points out what their future expectation is based on the most current data vs historical data.
Yes, it is just a guess on their part, however, it is an EDUCATIONAL guess.
I used to be a subscriber to Motley Fool, but cancelled because I didn't have enough Investments to warrant the $200 cost. However, I feel that the news letters does provide a lot of support for their picks.
Personally, I feel that they provide a lot more factual information then the likes of Cramer or others, but that's only me.
Will
Hi Greg,
While I agree that providing data is a good thing, the Motley Fool folks are good at putting whatever spin they want on a stock. Proof of this exists whenever they do their "why you should by xyz" article followed by another author's "why you should NOT buy xyz". Anyway, my point with their analysis is not that the data is missing, but that they're using the wrong data.
At least the Motley Fool offers SOME data to support their opinions...
Fund managers aim to beat a representative index. That isn't always the S&P 500. For instance, bond funds don't measure their success against the S&P 500.
Hence my argument that since there is an index created (S&P 600) using the same methodology as the S&P 500 then it makes more sense to compare an investment strategy based on small-cap stocks on this index.
The S&P 500 is the "index to beat" and is a comparison for any investing strategy. ("Why pick stocks or funds when few beat the S&P 500...") That's why.