The Motley Fool Million Dollar Portfolio: How to Build and Grow a Panic-Proof Investment Portfolio (Hardcover)

~ David Gardner (Author), Tom Gardner (Author)
Key Phrases: hidden gems, force protection, global gains, Rule Breakers, United States, Warren Buffett (more...)

Editorial Reviews

Review

"The best place online for talking with investors... amusing as well as educational." -- Barron's

"Their panache is a cover for a belief in the old-fashioned virtues of patience, simplicity, and prudence." -- U.S. News & World Report

"They’ve built up a large and much-deserved following." -- Washington Post

“Motley Fool makes investing fun again.” (BetterInvesting Magazine )

“The best place online for talking with investors... amusing as well as educational.” (Barron's )

“Their panache is a cover for a belief in the old-fashioned virtues of patience, simplicity, and prudence.” (U.S. News & World Report )

“They’ve built up a large and much-deserved following.” (Washington Post )

Product Description

In this long-anticipated, groundbreaking guide to building a portfolio, acclaimed stock pickers and Internet pioneers David and Tom Gardner lay bare the simple philosophy that they have used to help millions of grateful individual investors outfox the professionals on Wall Street.

The research, the stories, and the results that underpin this book stem from the revolutionary and wildly successful "Motley Fool Million Dollar Portfolio""—a one-of-a-kind Web experiment in which individual investors follow along as Motley Fool co-founder Tom Gardner invests and manages $1 million of The Motley Fool's own money.

In page after page of sound, sensible investment advice, readers are offered a rare glimpse into the inner workings of The Motley Fool machine—and offered a first-class education in building, growing, and defending an individual portfolio, one investment strategy at a time. From learning to think like an investor to finding a first stock, from dividend investing to blue-chip bargains to small-cap treasures, from international investing to community-based online tools that are revolutionizing stock selection and asset allocation, this book takes the reader through the essential strategies for building any portfolio—no matter how small its start or how big its ambitions.

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Product Details

• Hardcover: 288 pages
• Publisher: HarperBusiness; 1 edition (December 30, 2008)
• Language: English
• ISBN-10: 006156754X
• ISBN-13: 978-0061567544
• Product Dimensions: 9 x 6.3 x 1.2 inches
• Shipping Weight: 1 pounds (View shipping rates and policies)
• Average Customer Review: 3.8 out of 5 stars  See all reviews (60 customer reviews)
• Amazon.com Sales Rank: #83,309 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

64 of 72 people found the following review helpful:

4.0 out of 5 stars Excellent and Understandable Overview of Investing Styles and Portfolio Asset Allocation, December 27, 2008

By	Professor Donald Mitchell "Jesus Makes Me a P... (Thanks for Providing My Reviews over 93,000 Helpful Votes Globally) - See all my reviews (TOP 10 REVIEWER)    (VINE VOICE)

(What's this?)

If you apply this approach consistently and follow it for the next several decades, you will do well. If you follow your own ideas, I doubt if your results after tax will come close to what you could have earned by applying these methods.

One of the guilty little secrets about Wall Street is that the average investor does poorly, selling when stocks are down and buying when they are up, trading too often, piling up extra expenses for taxes and brokerage commissions. Why? People want to get rich quick. It's possible, but you are more likely to get rich slowly. This book teaches you how to do the latter by taking advantage of compounded returns.

David and Tom Gardner have provided a solid resource for those who are new to investing and want to take advantage of long-term trends and the odds to build a portfolio that will outperform inflation and the market averages. At a time like this when stocks have cratered and many bonds have buckled, many people will be reluctant to invest in anything other than treasury securities. Yet the best opportunities to invest usually come when things look quite bleak.

The book assumes that you've never bought a stock before. If that's you, I'm sure you will be able to pick a better stock than my first broker picked out for me (which promptly fell 95 percent in value).

From there, you'll learn about the benefits of buying stocks that grow and pay generous dividends (more than half of long-term gains from stocks come in dividend payments).

Next, the Gardners explain about buying high-quality, large companies inexpensively (at a discount, the Warren Buffett approach).

After that, you'll learn about why small-cap stocks should always outperform larger cap ones and how to pick the right ones.

The next section helps you spot companies that are breaking the mold with new business models that can give them extraordinary success over a short period of time (as Google did in the 21st century).

The Gardners next look at international investing and help you understand the various ways that you can pick successful stocks that will benefit from selling into locations where growth and profits will be high.

In the CAPS section, they explain about their online resource for assessing individual securities as a way for you to check your thinking.
It's an example of crowd wisdom.

Finally, you are shown how to assemble a portfolio using these various approaches . . . adjusted for your age, needs, and risk tolerances.

The book also gives you guidance on how to pick mutual funds in the appendix if you decide you don't want to be a stock picker.

The book has an excellent balance of summarizing the best academic research and outstanding books while providing simple "how to" directions complemented by examples that are completely developed enough to help you understand the analysis and thinking process that are being recommended.

I have only a few reservations about the book that kept me from grading it at five stars:

1. The book assumes that the investor is paying taxes on gains when incurred. If you are investing in a tax-deferred account (such as an IRA or 401k, the answers are a little different from what is described here).

2. The book assumes that an investor who reads this book wants to try to be a stock picker. Most people would be well advised not to be stock pickers. The joys of putting together a portfolio of index funds should have been explained in detail for those people.

3. The section on risk takers and rule breakers wasn't strong enough to teach someone what to look for. That surprised me given that the Gardners have published a book in the past on that very subject.

As a complement for this book, I suggest you also read John Bogle's Common Sense on Mutual Funds: New Imperatives for the Intelligent Investor and Jeremy Siegel's Stocks for the Long Run, 4th Edition: The Definitive Guide to Financial Market Returns And Long Term Investment Strategies.

Good luck!

32 of 39 people found the following review helpful:

1.0 out of 5 stars Worthless - a 230 page infomercial, January 10, 2009

By	Derek G (Redneck, South Carolina) - See all my reviews (VINE VOICE)

(What's this?)

My BS meter first started going off when they talk about how their various investing strategies beat the S&P-500 "over comparable period." Over what period? Years, months? They don't say. Without any track record we can't expect to take them seriously and I'm sure if they were beating the S&P over a long period of time they would provide specifics.

They proceed to explain various investing strategies such as investing in blue-chip companies, small-caps, income (dividend), growth, and foreign stocks. While they do provide some interesting studies that tout the benefits of their various investing methods, the information they give you to make informed decisions is virtually nonexistent.

For example, these are the qualifications needed to invest in a growth stock - they call it the Risk Takers and Rule Breakers strategy:

1. Top dog and first mover in an important, emerging industry
2. Sustainable advantage gained through business momentum, patent protection, visionary leadership, or inept competitors
3. Strong past price appreciation
4. Good management and smart backing
5. Strong consumer appeal
6. Grossly overvalued, according to at least one constituent in the financial media

Yes, they expand on these areas a little (3 pages) and give a couple of past picks but that's it. Do you really think that is enough information to separate the wheat from the chaff and pick a market beating company? And, seriously, are you going to wait and *not* invest in a company until some financial head-bobber criticizes your pick? This book is little more than a cleverly disguised advertisement to get you to subscribe to their newsletters. Even on their site they provide no information on or how their million dollar portfolio is doing - none!

The book cover says it will teach you "how to build and grow a panic-proof investment portfolio." On that point it fails, miserably.

30 of 37 people found the following review helpful:

1.0 out of 5 stars Wildly successful?, January 6, 2009

By	Alan K (Madison,WI) - See all my reviews

Wildly successful? Maybe wildly successful in their marketing and getting lots of members for their portfolio but not for their investment choices As a paying member however I can tell you that as of this writing the portfolio is doing only marginally better than the S&P 500 and even that is because they had a lot of their money in cash while getting the program rolling. Perhaps over time their investments will be wildly successful but it would be a gross exaggeration to call it that now. It is just too soon to tell.