Investor Tools Change With Economy

This past November I had the pleasure of meeting many of you at the AAII Investor Conference in Orlando. While I typically visit a few local chapters around the country each year, the Investor Conference offers a unique opportunity to interact with several hundred AAII members over the course of a few days. On a personal level, it was very satisfying to hear the generally positive comments regarding the changes CI has undergone over the last year. Likewise, I took to heart the comments on where we can stand to do better, and I hope we can do just that in the future. The Investor Conference also affirmed what I have come to learn over the last decade-plus, that AAII members are among the most knowledgeable and savvy individual investors around. I would like to think that AAII and Computerized Investing have played a role in that!

When AAII began over 30 years ago, independent sources of information and education for individual investors were few and far between. After the explosion of investing Web sites during the dot-com era, I feel that, in some ways, we are coming full circle. The last several years have seen the number of financial data providers drop due to consolidation in the industry. With only a few players remaining, the users of this data are placed in a more precarious position when it comes to negotiating data fees. We have also seen exchanges up the cost of the data they provide. As a result, the amount of free data available to individual investors has begun to decline as sites are unwilling to pay for the privilege of offering the financial data. These same economic pressures have forced many Web sites to discontinue popular tools and services that did not fit into their overall business model. Some that immediately come to mind include Reuters’ Powerscreener module and, more recently, the MSN Money Investment Toolbox. In many ways, these trends make Computerized Investing even more relevant than it has been in the past as individual investors seek out quality sources of financial data, research, and education.

As we close the books on 2009, many of us can take a moment to breathe a small sigh of relief following the market rebound of the last several months. That is not to say, however, that we are out of the woods just yet. The market still has a ways to go before it climbs out of the deep hole it dug for itself in 2008. Furthermore, the economy still poses significant headwinds to the market’s continued rise.

The New Year also brings about some important tax changes, among them new rules regarding the conversion of traditional IRAs to Roth IRAs. In this issue’s Spreadsheet Corner, you will find a calculator that will help you estimate the tax benefits of such a conversion.

In closing, I want to wish all of you a happy and prosperous 2010!