About AAII
Total number of AAII employees during 2009 = 28
Total number of AAII volunteers during 2009 = 442
AAII is a non-profit organization that relies on almost 500
volunteers to "keep and promote the faith", and to provide financial
information and entertainment to its members during local chapter
meetings, and during the meetings of its special interest groups
(SIGs). There is no doubt that the activities of the volunteers at
the local chapter meetings and SIGs enhance and complement the value
of the basic AAII membership, which, at $29 per year, is one of the
few bargains left in this world.
I have been an AAII member for more than fifteen years, and I
am grateful to AAII for giving me the opportunity to develop new
friendships, and for giving me the opportunity to gain knowledge
about effective investing. However, there is more to AAII than meets the eye.
AAII's mission is to give investors unbiased facts and effective
knowledge about investing. Unfortunately there is no credible
evidence that unbiased facts lead to performance that is greater
than the return of appropriate market indices. A veritable mountain of evidence
exists to demonstrate the certainty of the preceding
statement.
And fortunately, the crux of the previous paragraph is reasonably
easy to substantiate because AAII markets a
portfolio that meets two important requirements for validation:
1. Specific purchase and sale recommendations are made to subscribers.
2. The portfolio is ALSO professionally monitored
by the world's foremost independent financial newsletter monitoring service.
The only AAII portfolio that meets both requirements is the AAII Stock Superstars Report.
The professional
monitoring service is The Hulbert Financial Digest. For detailed information on both the AAII Stock Superstars Report and
The Hulbert Financial Digest,
go to AAII Superstars
In addition to basic membership, AAII promotes the AAII Stock Superstars
Report, AAII Stock Investor Pro, AAII Computerized Investing and the
AAII Quarterly Mutual Fund Update.
These services accounted for 28% of AAII's revenue during 2009, the latest year for
which data are available.
Stock Investor Pro, Computerized Investing and the Quarterly Mutual Fund Update do not
give subscribers specific purchase or sale recommendations. Instead, data about stocks
and funds are given to subscribers so that subscribers can use these data to make decisions themselves.
The home page of the AAII Superstars Report makes the following claims:
"Developed by the American Association of Individual Investors, this
publication teaches you how to build a successful investment
portfolio by coupling time-tested investment research with proven
risk-reduction strategies. This combination is both educational and
financially rewarding. By monitoring a wide range of research and
investment strategies, we identify investment approaches that have
promise to achieve a lower risk and higher return than the overall
market."
That means the portfolio managers of the AAII Stock Superstars Report are free to
use the information provided by AAII's Stock Screens, AAII's Stock Investor Pro,
AAII's Computerized Investing
and even AAII's Quarterly Mutual Fund Update to provide their subscribers with
"a lower risk and higher return than the overall market."
However, The
Hulbert Financial Digest's data show the
opposite is true i.e.,
the AAII Stock Superstars Report returned
LESS than the overall market with
higher risk over the 8+ years that the HFD has been monitoring it.
During the five years ending June 30, 2011:
The AAII Stock Superstars Report returned 2.4% per Year
The Vanguard S&P 500 Index Fund (Ticker VFINX) returned 2.86% per Year
The Vanguard Small Cap Index Fund (Ticker NAESX) returned 5.52% per Year
The risk levels of the SSR and the US stock market were equal during
this 5-year period.
Once again, for more details on the AAII Superstars go to
AAII Superstars
Non-profit organizations are required to file an
IRS Form 990 that is similar to an annual report, and this document is legally required to
be open for inspection by the public.
The AAII Form 990 can be downloaded by going to
NCCS
This is the website of the National Center for Charitable
Statistics.
Let’s take a look at the 2009 AAII Form 990, the latest year for which data are available.
Revenue for 2009
Subscriptions $1,567,053 (1)
Books $7,184
National Programs $642,471 (2)
Membership Programs $3,363,132 (3)
Total Revenue $5,579,840
(1) Subscription revenue includes Stock Investor Pro ($198 per Year), Computerized Investing
($20 per Year), Quarterly Mutual Fund Update ($24 per Year) and the Stock Superstars Report
($149 per Year). Subscription Revenue was 28% of total revenue during 2009.
(2) The National Programs includes the chapter revenue, and in this instance, the Investor
Conference. Since AAII did not have a conference in 2010, that year's tax return will reflect
lower revenue in this category. National Programs during 2009 accounted for 12% of total revenue.
(3) Membership Programs are all membership dues revenue.
Membership Program Revenue was 60% of
total revenue during 2009.
The top earners at AAII
during 2009
$470,603 James Cloonan, Chairman
$439,093 John Markese, Pres & CEO
Once again, I am grateful to AAII for giving me the opportunity to develop new friendships,
and for giving me the opportunity to gain knowledge about effective investing.
But some of the information above is troubling.
The term stewardship is used in a general way to refer to a
responsibility to take care of something belonging to someone else.
This information is posted on this website because I believe it is
of interest to AAII members, and because I believe the volunteers of
AAII should be acting as stewards for AAII's members as well as
AAII's management.
AAII was established about thirty years ago. I would like AAII to be successful for at least
thirty more years, but success in the future will be dependant on information that is above
and beyond "troubling".
Henry Wirth
August 2011