There’s plenty of resources on the internet for learning about stock market investing. But if you're the kind of person who prefers to learn from one source with all of its educational materials well organized, then the American Association of Individual Investors (AAII) might fit the bill.
AAII has a ton of educational material for investors at affordable prices. Whether you’ll get the same performance as claimed on AAII’s website by following the model portfolio is another question.
This article will go over the AAII memberships and look in more detail at the company's performance claims.
Quick Summary
- Loads of education for learning about stock investing
- Shadow Stock Portfolio that investors can follow
- Affordable annual membership pricing
American Association Of Individual Investors Details | |
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Product Name | American Association Of Individual Investors |
Services | Model Portfolios Financial Newsletters Stock Screeners and Reports Investing Blog |
Membership Fee | $49 (Basic) or $198 (Pro) Annual Fee |
Promotions | 30-Day Trials of Basic ($1) and Pro ($3) |
What Is The American Association Of Individual Investors (AAII)?
AAII is a financial newsletter service that is also a nonprofit organization. Here's how it defines itself on its website:
“The American Association of Individual Investors is an independent, nonprofit corporation formed for the purpose of assisting individuals in becoming effective managers of their own assets through programs of education, information and research.”
AAII was formed in 1978 and is located in Chicago, IL. Its founder and chairman is James B. Cloonan. The president and CEO is John Bajkowski.
What Do They Offer?
AAII provides a financial newsletter, various reports, and a model portfolio that investors can follow for an annual fee. They claim that the model portfolio “...outperforms the market by a 3:1 margin.”
There are two memberships to choose from — the Basic and the Plus. The AAII Basic membership includes:
- The monthly AAII Journal mailed to your door
- Members-only AAII Model Stock Portfolio
- Access to thousands of articles on AAII.com
- 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
- 100% unbiased research
- Daily stock ideas
- Money-back, no-questions-asked, guarantee
The AAII Plus membership includes everything in the basic and the following:
- Stock and fund evaluators
- Stock and fund graders
- Guru and factor screening
- Rigorous diversification analysis
- Portfolio insight tools
- User challenges and community opportunities
- A-F stock grades on return, volatility, expenses, turnover, etc
- Data on more than 6,200 stocks and 27,000 funds
Performance
With any newsletter, the big question is always "What kind of a return can I expect?" AAII proudly advertises that it's Shadow Stock Portfolio has outperformed the market 3 to 1 (919% to 236%) over the past 20 years.
For a more detailed look at how AAII has performed over time, you can check out the year-to-year performance of its model portfolio. It provides historical returns for each year beginning from 1993. While these returns are impressive, it's important to point out that they are no guarantee of future success.
Also, keep in mind that with any model portfolio, managers typically get to buy and sell their shares well before the members. As time goes by and more members decide to buy or sell a particular security, the overall trade performance may diminish.
For these reasons, it's not uncommon for the returns of newsletter managers to be much higher than what many of its members actually see.
AAII Financials
As a a nonprofit, you can view AAII's 2017 Form 990 filing at ProPublica. In that year, AAII had revenues of $7,988,940 and expenses of -$8,159,531, creating a loss of $170,951. Further, it’s assets were $8,581,653 and liabilities were -$17,944,784, creating net assets of -$9,363,131.
In short, AAII is in the hole and in a major way. What does this mean for anyone who subscribes to AAII? The risk is that AAII could shut down as a going concern if it can't maintain its daily operations or is overwhelmed by its debt burden.
If AAII is in the red, what do salaries look like for its highest-paid execs? The CEO made $280,202 in 2017 and the Senior VP of Operations made $226,956 in the same year.
According to PayScale, the average CEO of a nonprofit organization makes $54,000 to $207,000 per year. So AAII execs make as much (or more) than many of the highest-paid nonprofit CEOs, despite the fact that it's currently a company with negative assets and earnings.
Are There Any Fees?
Yes, there are two subscriptions tiers:
- AAII Basic — $49/yr. Includes 30 day trial for $1.
- AAII Plus — $189/yr. Includes 30 day trial for $2.
How Do I Open An Account?
You can visit https://www.aaii.com to become a newsletter subscriber. From the home page, look for the "Join Now" button on the top right-hand side.
Is My Money Safe?
Yes - the AAII website uses encryption and you are only using your credit card to complete the purchase. No money is deposited with AAII since they do not manage investor funds.
Is It Worth It?
AAII provides more than just a financial newsletter. It includes reports, a community of investors, and a model portfolio. There is a lot of education available and you are sure to pick up something of value that you probably haven't heard of before.
With $1 and $2 trials, it could certainly be worth trying out. But the true returns of model portfolios can be difficult to measure. And AAI's present financial situation could be additional cause for concern.
If you're looking for a "stock tips newsletter" alternative, you may want to read our review of The Motley Fool. Or if you'd prefer to learn how to build a diversified portfolio on your own, check out our "Investing for Dummies" guide.
American Association Of Individual Investors (AAII) Features
Services |
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Model Portfolios |
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Investment Screeners |
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Membership Fee |
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Wealth Management | No |
Customer Service Number | 1-312-676-4300 |
Customer Service Email | |
Mobile App Availability | None |
Promotions |
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American Association Of Individual Investors (AAII) Review
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Summary
The American Association Of Individual Investors (AAII) is a nonprofit that provides a financial newsletter, reports, and model portfolios.
Pros
- Four model portfolios to choose from
- Robust selection of stock and fund screeners
- Membership includes access to local chapter meetups
Cons
- Difficult to gauge actual returns of model portfolios
- No wealth management service available
- Company financials raise sustainability concerns
Editor: Clint Proctor Reviewed by: Chris Muller
Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.
Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.