Editor's Note

by Charles Rotblut, CFA

Editor's Note Splash image

Our 16th annual Best of the Web guide starts here.

The primary questions we ask ourselves when putting together the guide are: Does this website provide value and is it better than other websites? The answers to these questions can be subjective. I like the way MarketWatch.com categorizes news on its website, but many others prefer Yahoo! Finance. In other instances, the answers are much clearer. There simply is no free website with the amount of economic data that EconStats or the St. Louis Federal Reserve Bank’s FRED provide.

Another filter we use is determining whether a website gives news or noise. The Internet has provided a large platform to anyone who can write. The advantage is that you can quickly get a lot of opinions on just about anything you want. The downside is that you can quickly get a lot of opinions on just about anything you want.

This presents two problems. The first is one of determining what to look at. Behavioral studies have found that when a person is given too many choices, he’ll either opt not to do anything or default to the easiest cognitive action. On the Internet, this plays out with most Web surfers rarely looking past the first page or two of results on search engines like Google.

The second is the quality of the content. It is very easy to come off as confident, but that does not mean the author actually knows what he is talking about it. Plus, conflicts of interest exist. Financial content aggregation website Seeking Alpha gives an example of how conflicts of interest often exist. Earlier this year, the website started asking authors to reveal whether they wrote an article themselves, if they are receiving compensation for an article or whether a business relationship exists with a company whose stock is mentioned in an article.

Our intention is to provide solutions to both problems with our guide. We have searched the Web for the best financial websites. In some cases, a website is best for a specific topic. For instance, the Internal Revenue Service’s website is a great source for tax forms and publications. In other cases, a website is comprehensive enough to cover several topics well: Yahoo! Finance and SmartMoney.com are two examples. In all cases, if we have reason to believe the content on a website is questionable, it does not qualify for our guide.

The other choice you increasingly have is how to access the Internet. Tablet computers are growing in popularity. Smartphones are rapidly replacing the traditional cellphone. Along with growth in these devices are new apps to take advantage of them. Computerized Investing editor Wayne Thorp lists his favorite tablet and smartphone apps in his latest CI in the Journal column, which can be found here.

There are two other feature articles I want to call your attention to.

The first discusses the tax implications of investing in master limited partnerships (MLPs). Since these are pass-through entities in the eyes of the Internal Revenue Service, their tax treatment is different from that of corporations. Mary Lyman of the National Association of Publicly Traded Partnerships walks you through the tax rules and their implications for investors here.

The second is an update of our Model Fund Portfolio from AAII Founder and Chairman James Cloonan. The portfolio was up 11.5% at the end of September, as Jim remains focused on diversification and long-term results. He also suggests an optional bond fund for those who desire to hold one. His Model Portfolios column starts here.

Tax Issue Delayed

We are delaying the publication of our annual tax guide from the December issue to the January issue because of the uncertain 2013 tax rates. Congress is scheduled to start its lame duck session on November 13, and the December AAII Journal is due to the printer the following week. Let’s hope common sense and pragmatism prevail among the politicians. In the meantime, I discuss a few portfolio actions you may want to consider before year-end here.

Wishing you prosperity,
Charles Rotblut, CFA
Editor, AAII Journal
twitter.com/charlesrotblut

Charles Rotblut, CFA is a vice president at AAII and editor of the AAII Journal. Follow him on Twitter at twitter.com/charlesrotblut.


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