There is a good amount of information and educational material about stock market investing on the web. However, if you prefer to have all your information well organized and in one place, the American Association (AAII) may be right for you. This American Association of Individual Investors review will help inform you of all that AAII has to offer.
American Association of Individual Investors Review: Overview
AAII is a non-profit that offers a newsletter service to its members. The education, information, and research platform is aims to help individuals become effective managers of their own assets and investments.
The nonprofit was founded by James Cloonan in 1978. The current CEO of the company is John Bajkowski.
The resources are accessible through membership. Members have access to newsletters, educational information, and investment resources for an annual fee.
Currently, AAII offers a 30-day trial membership for just $1 or $2 depending on which tier you choose. This means investors can try out the resources and publications available from the organization for a very low price. We will get to more on that later, though.
AAII offers a good deal of educational information by the way of newsletters, model portfolios, investing ideas, stock screening, stock reports, and the AAII journal.
Let’s take a look at what the American Association of Individual Investors has to offer its customers in more detail.
What’s Included with an AAII Membership?
- Model Portfolios
- Investing Ideas
- Screeners and Reports
- AAII Journal
One thing that AAII offers its members is access to a few model portfolios. The model portfolios are one of the most popular tools on the website. They offer help in the investment research process.
The portfolios offered include the Shadow Stock portfolio, the Dividend Investing Portfolio, the Stock Superstars Report Portfolio, and the VMQ Portfolio.
Each of these are designed to help members invest more wisely based on academic research and guided investment strategy.
Let’s take a look at each portfolio.
Shadow Stocks Portfolio
The shadow portfolio got its start in 1993. It is a real-money portfolio the nonprofit uses to demonstrate a consistent investment approach.
The goal of this portfolio is to provide investors with investment ideas and investment education.
Insight into the stock selection is provided with this portfolio. The shadow portfolio follows the investing philosophy of James Cloonan. According to the AAII website, the philosophy is as follows:
- “The best stocks for individual investors are not the same stocks that are best for institutions.”
- “Ultimately, the best returns come from giving major consideration to risk.”
- “Success comes more from concern for the overall portfolio than for individual stocks.”
Dividends Investing Portfolio
This model portfolio will give you investment insight on how to invest dividends successfully. It includes a model portfolio of 24 dividend-paying stocks that are hand-picked by the organization.
Stock Superstars Report Portfolio
This portfolio offers specific advice on securities that are predicted to outperform the market. This service is based on superstar investors such as Benjamin Graham, Warren Buffett, William O’Neil, and others who have invested wisely and outperformed the market in the past.
VMQ stands for value, momentum, and quality. This portfolio attempts to seek out investments with low valuations but strong price momentum that has underlying quality traits. The VMQ portfolio provides 20 securities that were selected based on these principles.
The Investing Ideas feature on offer includes stock ideas, ETF ideas, and mutual fund ideas. Members can use this service to see which of these are top-performing. It also provides commentary and reports that can be used to further investor knowledge.
Screeners and Reports
Membership also includes access to stock screens and reports. The screeners can be used to decide which stocks might be worth attention. The following stock screens are available to members:
- Factor Screens
- Guru Screens
- Screen Power Rankings
- My Screens
- My Stocks
- Stock Grades Screener
Along with the stock screeners, ETF, and mutual fund screeners are available as well. This section of the website also offers reports on the various securities included in each screener.
All screeners are not available for both types of membership. You can read on to see what each membership tier includes.
The AAII Journal is a leading trade and investment publication that has been available for over 40 years. It is aimed at helping each member make better decisions when it comes to investing so that they can improve their results.
The journal seeks to help investors manage their portfolios, create a strong investment strategy, and navigate many financial situations.
The financial magazine is for any level of investor. It offers plenty of resources for financial planning, stock, and trading ideas, as well information on new opportunities in the market.
The journal is published monthly and delivered straight to member’s doorsteps.
American Association of Individual Investors review: Money-Back Guarantee
All first-year memberships are backed by a 100% money-back customer guarantee. This means that if at any time during your membership within the first year you are dissatisfied with the service, your money will be returned to you with no questions asked.
Therefore, with the $1 promotion currently available, AAII seems to be a very low-risk purchase for any investor.
The organization claims that the returns seen by using their strategy, resources, or tools will repay the cost of membership many times over.
American Association of Individual Investors Review: Membership Costs
There are two types of membership available with AAII. Let’s take a look at what each tier has to offer.
AAII Basic Membership
This basic membership has fees of $49 per year and includes a 30 day trial for just $1. The following come with the basic membership:
- The AAII Journal, mailed monthly
- AAII Model Stock Portfolio available only to members
- Access to resources and thousands of articles, reports, and commentary via the website.
- Top mutual fund guide
- Annual tax planning guide
- Access to AAII Local Chapter meetings
- AAII guide to ETFs
- Weekly stock investment ideas
- Lifetime investor strategy guide
- Daily stock ideas
- 100% money-back guarantee
AAII Plus Membership
The plus membership costs $189 per year in fees and includes a 30 day trial for just $2. This tier offers everything the basic membership does in addition to:
- Stock and fund graders
- Stock and fund evaluators
- Guru and factor screeners
- A thorough diversification analysis
- Insight tools for each portfolio
- User challenges
- Community opportunities
- A-F stock grades on return, volatility, expenses, turnover, etc.
- Data on more than 6,200 stocks and 27,000 funds
The fact that both membership tiers offer a trial period for either $1 or $2 makes it easy to start using the platform for little risk.
Is AAII Legitimate?
Since no funds are deposited with AAII, the nonprofit seems to be low risk as it does not invest funds for you. It only offers resources and advice to make you more skilled at investing.
Additionally, the performance claims are high. You may be wondering what types of returns you can expect to see from the research and model portfolio on offer. Returns can certainly vary and profit depends on the specific investments made by each member.
You can see the specific returns on the model portfolio on a year-to-year basis, since 1993, by clicking here.
AAII advertises that its shadow stock portfolio has outperformed the market by 3 to 1 over the past 20 years.
This is a significant feat for any portfolio. However, investors should understand that this type of return is not typical. Also, following the investment guidance of this specific portfolio is not a guarantee for future success.
However, one problem with the non-profit is that they seem to be losing money in a significant way. Tax returns from 2017, when the organization became a non-profit show a loss of $170,951.
Customers may worry that continued losses will cause the organization to shut down. However, this does not seem to be likely to happen anytime soon. The company is still alive and kicking years after reporting the initial loss.
American Association of Individual Investors Review: Pros and Cons
There are a few pros and cons that come along with the American Association of Individual Investors.
- Four model portfolios
- A good selection of both stock and fund screeners
- Plenty of resources for learning about investing
- Access to monthly local chapter meetups
- $1 or $2 30 day trials available
- 100% money-back guarantee
- An analysis of actual returns from the model portfolio is somewhat difficult to find
- No wealth management service
- The recent financial difficulties of the company raises concerns
What is AAII Sentiment?
AAII sentiment is a survey that measures the percentage of members who are bullish, bearish, or neutral investors. This section of the website provides insight into the investing habits of AAII customers.
Members are polled each week and only one vote is allowed per user.
Is AAII Right for Me?
If you are interested in learning more about investing, want to start investing but don’t know where to begin, or are a seasoned investor looking for more information then AAII may be right for you.
The stock screeners, monthly journal, and investment ideas could help an investor make more financially sound decisions when investing in the stock market.
However, if you are looking for quick and easy profit this service is likely not for you. Members will need to take the time to read through a good amount of material and research that is available on the website, in the newsletter, and in the magazine in order to truly find success investing with the guidance of AAII.
AAII overall seeks to teach members how to manage their assets through programs that have a good track record for success.
While the service may not tell you whether or not to buy or sell, AAII’s commitment to providing quality financial information appears to have the potential to be of great use to short-term and long-term investors.
However, the very low-cost 30-day trial is a great way for anyone to start learning about investing. The annual fees for either tier of membership are lower than many programs of education information on the web as well.
AAII Reviews by Members
Reviews from members are generally positive. Many are happy with the newsletter and the wealth of information available. They claim that information comes from a reliable source and the information on investment and personal finance is some of the best on the market.
Additionally, comments from members on www.stockgumshoe.com show that customers are happy with the service. Most of all, they are happy with the amount of information that is available to members.
One of the comments from a member even states that AAII is the best value he has found in over 50 years of investing.
There were few bad reviews, with most of the negative ones stating that the paid service is not much better than the free service offered. However, it seems that with the paid membership there is quite a lot of unique content available.
Final Review: Is AAII Worth It?
In conclusion, AAII’s service seems to be a great source of financial information when it comes to investing. The nonprofit organization’s goal is to help investors learn more about the market and make sound financial decisions.
The tools included in membership, such as stock screening, model portfolios, investment ideas, and reports all appear to be very useful.
Additionally, the 30-day trial at such a low price is also a great deal. This is especially true considering the amount of information that is available on the website alone. If you are not sure if AAII’s offering is right for you, then the free trial is a great way to start.
Overall, members appear to be happy with the service. The amount of information provided to members with either tier is one major advantage that AAII offers over its competitors.