Action Alerts PLUS Review: Can You Really Trust It? (2022)

DISCLOSURE: THIS POST MAY CONTAIN AFFILIATE LINKS,MEANING That I GET A COMMISSION IF YOU DECIDE TO MAKE A PURCHASE THROUGH MY LINKS, AT NO COST TO YOU. PLEASE READ FULL DISCLOSURE HERE

[Update: As of Sep 2021, Jim Cramer is no longer affiliated with Action Alerts Plus. In Jan 2022, Jim Cramer launched CNBC Investing Club together with CNBC. With CNBC Investing Club, you have access to Jim Cramer’s charitable trust portfolio where you can see every move Jim Cramer and his team make for the portfolio and get their market insight.]

So, is the Action Alerts PLUS subscription worth the money?

What are you really getting from the Action Alerts PLUS subscription?

Can you achieve market-beating returns by following the stock picks inside the Action Alerts PLUS portfolio?

Are there any better stock picking services than Action Alerts PLUS?

Action Alerts PLUS Portfolio

So, what is Action Alerts PLUS?

And what can you actually get from it?

Action Alerts PLUS used to be Jim Cramer’s members-only investing club, providing real-time trade alerts and investment advice from Jim Cramer and his research team.

Cramer’s Action Alerts PLUS portfolio was created in August 2001 and sold on TheStreet.com.

Later on, the fund was converted into a charitable trust in 2005 with a stated mandate to donate any resulting dividends and distributions to nonprofit organizations.

Now, let’s take a closer look at what exactly you are getting.

As an Action Alerts PLUS member, you get full access to Jim Cramer’s $2,500,000 charitable trust portfolio which consists of a number of stocks.

The number of stocks in the portfolio fluctuates over time.

But generally, there would be more than 20 stocks.

On top of that, you get a real-time notification on every buy or sell trade that Jim Cramer and his team are about to make, together with their trading analysis.

Action Alerts PLUS Portfolio Returns Vs S&P 500

So, what is the past performance of Jim Cramer’s charitable trust portfolio over the years?

Did it manage to beat the market every year?

As of 31st Dec 2020, the returns of the Action Alerts PLUS portfolio are 189.97% while the returns of the S&P 500 index are 349.57%.

That means the Action Alerts PLUS portfolio has been underperforming the S&P 500 index over the years.

If you have invested $10,000 in Cramer’s Action Alerts PLUS portfolio since 2001, your investment would be worth $28,997.

On the other hand, if you had invested $1,000 in S&P 500 index, your investment would be worth $44,957.

That’s a huge difference!

Now, let’s look at the performance comparison between the Action Alerts PLUS portfolio and S&P 500 every single year since 2001.

	Action Alerts PLUS	S&P 500
8/1/2001 -12/31/2001	-2.67%	-4.64%
2002	-19.79%	-21.97%
2003	34.46%	28.36%
2004	5.25%	10.74%
2005	5.19%	4.83%
2006	7.05%	15.61%
2007	9.51%	5.49%
2008	-37.67%	-36.55%
2009	31.14%	25.93%
2010	14.29%	14.82%
2011	-9.58%	2.1%
2012	16.67%	15.89%
2013	25.78%	32.04%
2014	1.33%	13.52%
2015	-2.33%	1.37%
2016	4.86%	11.76%
2017	12.66%	21.6%
2018	-9.86%	-4.23%
2019	30.39%	31.19%
2020	24.95%	18.05%
2021	27.64%	28.56%

As you can see from the table, the Action Alerts PLUS portfolio has ONLY narrowly beat the market 7 times out of the 19 years from 2002 to 2021.

Honestly, I am pretty disappointed by this poor performance.

I mean, you would be much better off just putting your money in S&P 500 index ETFs, and also save yourself $299/year subscription fee and save yourself a lot of time from making so many trades based on the alerts.

So, if you are looking for a stock picking service for long-term investments with a proven track record of beating the market, I highly recommend that you check out my review of Motley Fool Stock Advisor.

Action Alerts PLUS Cost

So, how much does Jim Cramer’s Action Alerts Plus cost?

There are three types of pricing plans:

• Monthly subscription: $29.99/month
• Annual subscription: $25/month (or $299.99/year)
• Two-Year subscription: $20.83/month (or $499.99/two years)

There is a 14-day free trial before it starts to bill you with the option to automatically renew your subscription.

If you want to cancel and ask for a refund, that’s NOT going to be possible because they recently changed their terms of service on refunds.

So, once you have made payments, there are no refunds.

Is this subscription expensive?

Personally, I don’t think it’s worth paying $299.99/year for it.

Here’s why.

The stock picks in the Action Alerts Plus portfolios are NOT for long-term investments, unlike Motley Fool Stock Advisor stock picks.

There are just too many trades (add to positions, taking profits, or trimming positions) going on to my liking.

For me, I want to buy fundamentally solid stocks with long-term growth potential and hold them for years, and not get affected by the temporary market swings.