AOL and The Rule Breaker Portfolio
The Fool FAQ
You are always singing the praises of America Online--how can we believe you when you not only own the stock, but also have a business relationship with the company?
Do business relationships preclude investment relationships? The Fool is an independent corporation that has operated on the America Online platform since August of 1994. In that time, we have come to know the company and its consumers pretty well. The Rule Breaker Portfolio managers (others may disagree, of course) view owning America Online's stock as a very fine example of buying what we know.
AOL helped the Fool get started with a seed-money loan in 1995 and now holds 13% of Motley Fool stock and one seat on our Board of Directors.
David Gardner, who owns the money that funds the Rule Breaker Portfolio, bought AOL when the forum opened in 1994 (before the AOL invested in the Fool), and sold half of the investment in 1997 (before a huge run-up -- ouch!). But we sincerely hope that anyone investing in AOL (or any other company) does so only after independently researching the company, gathering information and opinions from many sources and arriving at their own decision. Anyone who buys or sells a stock based solely on Fools' expressed opinions is doing so for the wrong reason.
The Rule Breaker Portfolio's returns are public, scrutinized under a microscope, and extremely important to us. We will not allow any subordinate considerations (like favoritism, for example) to compromise those returns. The Rule Breaker Portfolio is an illustration of our approach to investing, and therefore, like our other real-money portfolios, it is a large foundation for our entire business.
More importantly, we hold honor far above performance. This is a point of honor about which we can only ask the skeptic's trust. Some will always want to impugn our honor, but that's something we've come to live with; we'll let the analysis and the numbers speak for our part. Please recall that one of our Foolish maxims is that over the long term, truth and honor will always show (as they have since 1994... it's a legacy we're building). We urge you to measure us by our long-term returns.
Finally, please keep in mind that this is just our money, and our portfolio(s). Our real-money portfolios serve as real-life examples, but not as any sort of strict guideline to follow by any means. All investors must invest on their own terms and for their own reasons. The money in our portfolios is our money and is managed with our ideas. We present everything in public with the not immodest hope to educate, amuse, and enrich those who have an interest in investing and who find that interest piqued by The Motley Fool. Fool on!