Our review of the Prudent Speculator leads the Stock Newsletter Club to rank it as a lower tier 2 stock selection. Anyone who has spent just a small amount of time in the world of stock market newsletters, or even just in the stock market in general, knows the name of the Prudent Speculator. Until recently this stock trading newsletter has held a high ranking, often coming in at number 1 on Hulbert’s Financial Digest for the past 30 years. Although the stock market has certainly had its ups and downs during that time, the Prudent Speculator consistently gives valuable stock advice to its subscribers that keep their portfolio growing despite what the market is doing.

Positives

  • Long track record of above average performance.
  • Since John Buckingham took over as editor for Al Frank a decade ago, the Prudent Speculator no longer relies on margin to beat their benchmark.
  •  A large number of stocks are held creating more diversification.
  • Long term investment philosophy reduces trading costs and capital gains taxes.

Negatives

  • Performance has declined over the past decade without the use of leverage.
  • Performance has lagged historical returns and that of the Wilshire 5000 and S&P 500 total returns over the last decade.
  • Holds a large number of stocks making it hard to be invested in all the recommendations without a sizable investment nest egg.
  • Biggest drawdowns have on average been greater than the stock market drawdowns.

The Prudent Speculator Philosophy

Founded in 1977 by Al Frank, the Prudent Speculator takes on a philosophy of value investing. Stock trading isn’t so much about taking large risks as it is about carefully researching and analyzing the market to discover which investments will be the most lucrative and then taking action on that information. This approach to stock market trading is what has made the Prudent Speculator so successful for 3 decades and earned it the reputation it has today.

Performance

Approximately 70 percent of all stocks recommended by the Prudent Speculator become successful.  Subscribers get a monthly newsletter with all the details, along with emails three times per week with tips and stock advice. Most subscribers feel that the fee for the Prudent Speculator is more than worth it in terms of smart investing and returns on investment.

Prudent Speculator Reviews

Hulbert’s once said the Prudent Speculator is one of the best stock market newsletters of all time. What do subscribers have to say? Let’s take a look:

• “Subscribing to this newsletter was the single best investment decision I have made in my life. This newsletter is well worth the price for portfolios of $20,000 or more.”
• “Over the past year this letter is up 36% and averages (even with the poor 2008 performance) over 10% annually for the past 10 years. I wish all my investments had been so generous.”
• “If you take some time to learn, you will probably make some money following the Prudent stock tips.”
Even the investing subscribers agree that the Prudent Speculator is high on the list of all stock market newsletters. A stock trading newsletter doesn’t get that kind of notoriety unless it has something valuable to offer, especially considering how many stock market newsletters there are out there in the first place.

Above all, however, you must realize that there is a learning curve to stock trading, particularly if you are new to the world. The stock advice offered by the Prudent Speculator can help you increase your portfolio, but you must put in the hours to follow the advice carefully and make intelligent decisions.  Additionally, performance has decreased without the use of leverage.