Ten years ago when I was editor of Forbes Best of the Web our job was to review hundreds of investment-oriented web sites. Back then, I was excited by the flurry of activity in the online investing arena. Hundreds of new web sites were created for investors who were going online. Investors were flocking to the Web at first because their discount brokers were offering cheaper commissions for electronic trading. Then they began to go online to use free tools, read news, and monitor their portfolios.
However, being a skeptic as well as a student of the investing legends, from Warren Buffett and John Templeton to Peter Lynch and Jack Bogle, I was concerned that cheap PCs and powerful Web software in the hands of mobs of unsophisticated investors were dangerous things. After all, these great investors taught us the importance of things like patience, intrinsic value, contrarian investing, buying what you know, and keeping costs down. For all its promise and freedom, the Web was developing into a cluttered noisy bazaar of enticing investment sites, chat rooms, tools, and schemes.
Nearly anyone could hang out a virtual shingle and claim to be an investment guru. By 2000 people were beginning to think that beating the market was as easy as setting up an account with E*Trade and clicking away. We all witnessed the consequences of this euphoria when the dot-com bubble burst in mid-2000.
The euphoria may have subsided but the number of investment-oriented ...